Problem 2 Real wages in Britain 1860-100 180 150 120 90 300 1850 60 70 80 90 1900 Source: Clark, 2005 revolutions (though historians bicker about terminology). The First Industrial Revolution was about the introduction of machines, often powered with water Europe went through a period of astonishing growth or steam. It lasted from roughly 1760 to 1850. The after about 1760. The level of income that Europe has Second Industrial Revolution used more advanced today could not have been reached without the technologies, such as the internal combustion engine Industrial Revolution. In fact, people often refer to two and electricity. It lasted from roughly 1850 to 1910. A. Consider the graph and excerpt above to explain the increase in real wages in Britain using the classical or real business cycle growth model. B. Labor supply decisions by individuals may be affected by income and substitution effects. Explain how the relative strength of these two effects would have played a role in determining the level of real wages and employment before and after the Industrial Revolution