What circumstances and factors made possible the "Industrial Revolution" in Britain in the late 18th and early 19th centuries? 

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There were many different factors that made the development of industry in Britain possible. Some were political, others cultural and social, and still others environmental. Politically, while Britain was by no means free of divisions, by the late eighteenth century, it had been free of internal struggle for more than 100 years. British involvement in foreign wars, though expensive, had amassed a large empire that proved very profitable for merchants, who in turn could invest these profits in domestic industry. Moreover, the existence of colonies, along with British naval power created expansive markets for manufactures. 

Great Britain also saw the rise of pro-business philosophies. Thinkers like Adam Smith rejected the old mercantilist theories that he saw as ultimately bad for the economy. Their thinking, along with the political reality that many successful businessmen were also politicians, led to loose regulations and especially the establishment of easy credit for investors (though not for most people,) lax regulation of business, and laws that upheld private property, favored creditors over debtors, and enforced contracts. These laws, while increasingly oppressive to common workers, did create the atmosphere where innovation could pay. The constant warfare of the eighteenth century also led to powerful financial institutions that could finance war and business ventures.

Britain had also seen a massive population surge during the eighteenth century, and the effect of this growth was intensified by the enclosure movement, which saw millions of small farmers reduced to wage labor as the gentry consolidated their holdings on land in the countryside. These gentry also revolutionized agricultural techniques, enabling them to literally feed more Britons. The decline of small farmownership, however, created a new, more mobile working class that could relocate to urban settings to take jobs in mills and factories.

Finally, Britain was naturally rich in the resources demanded by emerging industries. Not only was the countryside rich in coal and iron, two resources much in demand, but the country also has a number of navigable rivers and fast-moving streams that could be used both for transport and to power mills before steam power was harnessed for large-scale industrial use. 

To sum up, Britain had geographic advantages, a fully-developed state, a large working class, and emerging pro-business ideologies and politics. These interlocking factors made Britain the site of the first wave of the Industrial Revolution.