The second half of the 18th century saw a sequence of closely-clustered innovations in England: Hargreaves’ spinning jenny was invented in 1764, Arkwright’s water frame in 1769, Watt’s steam engine in 1775. These arrived as manna from heaven, shifting outwards society’s production possibility frontier just as Neo-Classical growth theory would predict. It took time for these fledgling GPTs to broaden their application and influence, measured in decades. 20 Growth and productivity only began picking up well into the 19th century. As they did, this generated a wave of physical investment – in factories, machines, locomotives. This combination of rapid investment, and technological transformation, lit the fuse on a Golden era of sustained rises in living standards, the first in human history. This Neo-Classical account of growth dynamics is lent support by Table 2 which shows estimates of growth in technological efficiency either side of the Industrial Revolution. 21 Prior to it, technological gains were fractions of a percent each year. Outward shifts in the production possibility frontier, like rises in living standards, would have been imperceptible. After 1750, a technological light switch was flicked. Growth in technological efficiency has averaged around 1% per year in the period since. Technological advance, in turn, fed physical capital accumulation. Chart 5 shows the path of the physical capital stock per head in the UK after 1850. It has risen, on average, by 1.75% per year.
These exclusions include companies responsible for large-scale environmental damages, and companies whose business models relies heavily on thermal coal. . Specific central bank challenges in policy portfolio management Aside from the GPFG, Norges Bank, as other central banks, also manages policy portfolios. The Bank’s foreign exchange reserves amounted to USD 64 billion at end-June 2019, divided into a 80% fixed-income portfolio and a 20% equity portfolio. The equity portion is invested in around 1,500 companies worldwide, with a focus on the larger markets and currencies, and managed according to similar principles governing responsible investment in the GPFG. The investment of the major part of the FX reserves is to a high degree determined by our central banking policy objectives. Consequently, we face specific challenges in any extension of responsible investment practices. First, this relates to respecting our legal policy mandate in the investment of our FX portfolio. Second, our investments must take due account of liquidity needs for monetary and financial stability purposes, as well as international financial commitments to the IMF. Third, we need to be vigilant to safeguarding independence and preventing conflicts of interest. And finally, while we are a transparent central bank, we need to strike a considered balance between transparency and remaining needs of confidentiality, to avoid undermining our 2/3  BIS central bankers' speeches  primary policy objective. International cooperation To conclude, like in other policy areas, there is a crucial role to play for international cooperation also in the field of climate risk.