The Origins of the Industrial
Revolution in America
George S. Vascik
Miami University Hamilton
The Industrial Revolution
The Industrial Revolution
• Definition
– Preconditions
– Process
– Results
The Industrial Revolution
• Definition
– Preconditions
– Process
– Results
• The American experience before 1860
Definition
Definition
• Began in Britain circa 1750, with
production of cloth and pottery.
Definition
• Began in Britain circa 1750, with
production of cloth and pottery.
• Accompanied by a huge increase in output
per capita.
World Gross Domestic Product
World Gross Domestic Product
Definition
Definition
• Began in Britain circa 1750, with
production of cloth and pottery.
Definition
• Began in Britain circa 1750, with
production of cloth and pottery.
• Accompanied by a huge increase in output
per capita.
Definition
• Began in Britain circa 1750, with
production of cloth and pottery.
• Accompanied by a huge increase in output
per capita.
• Profoundly changed society and politics.
Definition
• Began in Britain circa 1750, with
production of cloth and pottery.
• Accompanied by a huge increase in output
per capita.
• Profoundly changed society and politics.
• Concentration of production in factories.
The concentration of
production in factories
First chart
long term
preconditions
The concentration of
production in factories
short term
First chart
long term
preconditions
energy
capital
labor
The concentration of
production in factories
markets
laws
ethos
First chart
short term
Energy
Energy
• Prior to 1760, most
energy was animal
– Human
– charcoal
Energy
• Prior to 1760, most
energy was animal
– Human
– charcoal
• Innovations in steam
technology
– Newcomen, Watt,
Stephenson
Energy
• Prior to 1760, most
energy was animal
– Human
– charcoal
• Innovations in steam
technology
– Newcomen, Watt,
Stephenson
• Development on
coking technology
Capital
Capital
• Where did the money
(capital) to invest in
new machines and
factories come from?
– Agricultural revolution
– Commercial revolution
• Banks
• Colonial trade
– Sugar
– slaves
Labor
Labor
• With the Agricultural
Revolution and then
the increasing
mechanization of
farming, fewer hands
are needed in the
fields
Labor
• With the Agricultural
Revolution and then
the increasing
mechanization of
farming, fewer hands
are needed in the
fields
• This freed up surplus
labor to work in the
factories
Markets
• Home market
– The area within a
single legal and
customs zone
• Consumers
– Disposable income
– Luxuries
– Common commodities
Laws
• It is impossible to
underestimate the
importance of a secure
legal environment the
recognized contract
and the right to
property
• The British and the
Dutch led the world
Ethos
• Max Weber (18641920)
– The Protestant Ethic
and the Spirit of
Capitalism
– General Economic
History
• Werner Sombart
(1863-1941)
– Modern Capitalism
preconditions
energy
capital
labor
market
ethos
Short term
The concentration of
production in factories
preconditions
energy
capital
labor
The concentration of
production in factories
market
ethos
Short term
short term
preconditions
energy
capital
labor
The concentration of
production in factories
market
ethos
short term
shift in population
shift in wealth
boom and bust
shift in power
Short term
Urbanization
• German cities over
100,000 population
– 1800 = 8
– 1900 = 33
• By 1860, 16% of the
American population
lived in cities
• 300,000 immigrants
arrived annually
Chicago, 1820-1898
Chicago, 1820-1898
1820 - 15 people
Chicago, 1820-1898
1820 - 15 people
1854 - 55,000 people
Chicago, 1820-1898
1820 - 15 people
1854 - 55,000 people
1898 - 1,689,000 people
Business cycle
Business cycle
Business cycle
Panics
Panics
• Cyclical
downturns
– These were
known as
“panics”
– Highly
politicized
Panics
• Cyclical
downturns
– These were
known as
“panics”
– Highly
politicized
• 1837, 1857,
1873, 1884
Shift in power relations
Shift in power relations
• Capitalist and noble
Shift in power relations
• Capitalist and noble
• Worker and owner
– Jacksonian class
conflict
– Whig class concord
Shift in power relations
• Capitalist and noble
• Worker and owner
– Jacksonian class
conflict
– Whig class concord
• Urban and rural
– Agrarian versus
industrialist
preconditions
energy
capital
labor
The concentration of
production in factories
market
ethos
short term
shift in population
shift in wealth
boom and bust
shift in power
Full chart
long term
preconditions
energy
capital
labor
The concentration of
production in factories
market
ethos
short term
shift in population
shift in wealth
boom and bust
shift in power
Full chart
preconditions
long term
energy
modern city
capital
labor
The concentration of
production in factories
market
ethos
short term
shift in population
shift in wealth
boom and bust
shift in power
Full chart
increased wellbeing
regulated
economy
family patterns
and life span
- sharp increase in per capita
productivity
- improved standard of living
- creation of a global economy
preconditions
long term
energy
modern city
capital
labor
The concentration of
production in factories
market
ethos
short term
shift in population
shift in wealth
boom and bust
shift in power
Full chart
increased wellbeing
regulated
economy
family patterns
and life span
American in Comparative
Perspective
Ante-Bellum American growth
Ante-Bellum American growth
• Population growth
– Birth rate 2x Europe
– Lower death rate
– immigration
Ante-Bellum American growth
• Population growth
– Birth rate 2x Europe
– Lower death rate
– immigration
• Urban growth (towns > 2500)
– 1810 - 6%
– 1860 - 20%
Ante-Bellum American growth
• Population growth
– Birth rate 2x Europe
– Lower death rate
– immigration
• Urban growth (towns > 2500)
– 1810 - 6%
– 1860 - 20%
• Income rose 102% between 1810 and 1860
Characteristics of American
growth
Characteristics of American
growth
• Transportation revolution
Characteristics of American
growth
• Transportation revolution
• The “American system of manufacture”
– Interchangeable parts
– Labor scarcity
– High resource endowment
Characteristics of American
growth
• Transportation revolution
• The “American system of manufacture”
– Interchangeable parts
– Labor scarcity
– High resource endowment
• Educational system
– Widespread literary in North
Characteristics of American
growth
Characteristics of American
growth
• Fluidity of American class system
– Entrepreneurial ethos
– Secularized puritan ethic
Characteristics of American
growth
• Fluidity of American class system
– Entrepreneurial ethos
– Secularized puritan ethic
• The frontier
– “Go West, young man!”
Short Term Results
• North
– New England, Middle Atlantic and Midwest
develop into free labor, advanced industrial and
agricultural society.
• South
– Plantation-based resource economy, with sharp
divisions of wealth and power.
– Work habits necessary for industrial success
fail to develop.
Long term result
Thank you!