MANIFEST DESTINY &
EXPANSION
American History I - Unit 7
Ms. Brown
7.1 – THE MARKET
REVOLUTION
The Market Revolution
• Shift to buying/selling goods instead of making everything
yourself, led to the growth of the American economy
• Focus on cash, wages, and prices
• Specialization on farms
• Rise of capitalism
• New inventions
• Increased communication
• Improved transportation
Specialization in Farming
• Specialization –
growing 1-2 crops to
sell at home/abroad for
a profit
• Self-sufficiency  profit!
• Used money made by
selling crops to buy
goods…
• Manufactured goods from
the North
• Other food from the South
and West
Specialization in Farming
• How did specialization in farming contribute to the Market
Economy?
• Farmers could sell their crops to other areas of the country and in
return act as consumers to buy goods from other people/industries
• Consumers – people who are the final users of a product or good
• Consumerism – the buying of goods for use
• Led to growth in the US economy (more people buying/selling)
Rise of Capitalism
• Capitalism – the economic system in which private
businesses/people control and own the
production/manufacture of a good and sell it to earn
profits
• Requires “capital” – the money property, machines, and factories
needed to make the good.
• Relies on competition in the economy
• Entrepreneur – a wealthy investor that risked money to
fund new industries
• Risked money if the company/industry failed
• Potential to earn a lot of money if the company/industry was
successful
Rise of Capitalism
• Example…
• 1813 – Francis Cabot Lowell and other Boston
investors/entrepreneurs put up $400,000 to form the
Boston Manufacturing Company that produced textiles.
• $400,000 = capital
• Owned the means of production for the textiles in those factories
• Made a lot of money selling the textiles  the
investors/entrepreneurs got a “return” on their investment (a piece
of the profits)
• If the company had failed, the investors/entrepreneurs would have
lost their money.
Rise of Capitalism
• How did the rise of capitalism contribute to the Market
Economy?
• Capitalism allowed for individuals to buy and sell goods according
to the supply and demand of the good.
• Capitalism thrived on competition which led to growth of the
economy as new industries emerged.
• Increased production in factories + competition  lower prices
(easily make a lot of 1 thing for less money
• Birth of Wall Street and investors
New Inventions
• During the mid-1800s, new inventions with the help of
entrepreneurs contributed to the growth of the Market
Economy  more goods faster!
Inventor and Year
Invention
Charles Goodyear
(1839)
Vulcanized rubber – a rubber that did not melt or freeze,
perfect for protecting boots (later tires)
Elias Howe
(1846)
Sewing machine – used in factories to mass produce
clothes/shoes
John Deere
(1837)
Steel plow – a steel device that made it possible to plow
and plant crops in the rocky Midwest soil
Cyrus McCormick
(1837)
Mechanical reaper – a machine that quickly cut and
harvested wheat
New Inventions
New Inventions
• How did new inventions contribute to the Market
Economy?
• New farming equipment made it easier to mass produce food which
could be bought and sold in other parts of the country.
• The steel plow made farming in the rocky mid-west soil possible.
• The sewing machine was eventually developed for use in factories
 large scale production of clothes/shoes!
• People could buy clothes/shoes already made, instead of making
them for themselves.
• Technological advances = more manufactured items quicker and
cheaper = lower prices = American people become CONSUMERS!
(buyers of goods)
Increased Communication
• 1837 – Samuel F.B. Morse invented the telegraph
• A device that sent instant electrical messages over copper wires
• Message = a telegram
• Telegrams were typed in Morse Code (a code of transmissions to
communicate information through the telegraph)
Write your name in Morse Code!
Increased Communication
• How did the telegraph contribute to the Market Revolution?
• The telegraph REVOLUTIONIZED communication.
• People could communicated instantly over large distances.
• Before the telegraph, you could only communication as fast as horses could
deliver your letters.
• Businesses used the telegraph to send orders and relay up-to-
date info on prices and sales.
• Railroads used the telegraph to keep trains on schedule and
report delays.
• By 1854 (~15 years after its invention), 23,000 miles of
telegraph wire crossed the country.
Improved Transportation
• Early 1800s – steamboats become popular for transporting
goods and people on rivers and canals
• A steamboat did not rely on the river current or the wind – it was
powered by steam engines that could turn and power the boat in any
direction
• 1825 – Erie Canal finished
• Connected Atlantic Ocean to Great Lakes
• Soon, more canals were completed around the country
• Easier and cheaper to float heavy materials on water
Improved Transportation
• Canals were very popular until
the 1860s  RAILROADS!
• Could operate in the winter when the
canals were frozen
• More expensive than canal shipping,
but much faster.
• Brought goods to people who lived
away from water.
• Passengers enjoyed the “high
speed” of trains (10 mph) and trains
were more comfortable than
steamboats
• By 1850, 10,000 miles of rail
crossed the country
Improved Transportation
• How did canals and the railroad contribute to the Market
Economy?
• Goods and people could be moved quickly and reliably across the
country.
• Quicker and more available goods  more consumerism in
America
• Connected, but also separated the US regions…
• Connected – North, South, and West could get goods from the
other
• Separated - Each region specialized in just a few activities and had
different economic and political needs
The Market Economy – The Big Picture
NORTH
Manufactured textiles and machinery
in factories
(sewing machine, vulcanized rubber)
Investors, entrepreneurs, capitalism,
Wall Street
Telegraph
Canals
Railroad
WEST
Crop specialization - harvested
wheat and raised cattle
(mechanical reaper, steel plow)
SOUTH
Crop specialization - Cotton,
tobacco