Early market economy

1

The Early Market Revolution

AP United States History

1830’s - Development of Market Economy •  Decline of traditional subsistence agriculture

Industry & Commerce 1800-1860

Predominance of Cash (rise of wage labor)

Specialization

Mechanization & Invention

Onset of “Boom & Bust” Cycle

Economic Growth

The Market

Economy


Depression

Prosperity

Expansion Contraction

Recession

Prosperity “Boom & Bust” Cycle

Speculation → bank collapses Bankrupcies → unemployment


Regional Specialization North: Industry & Finance South: Plantation & Cotton Production West: Commercial Farming

Northern domination & development of East - West transportation network

Erie Canal – 363 Miles long; 4 feet deep Buffalo to New York – 10 Days

Internal Improvements

2

Old Road

Tom Thumb Locomotive : Illustration of a Race Between a Locomotive and a Horse-Drawn Car (1830)

•  Significant impact of Railroads on the economy –  increased agricultural development in West

•  aided by John Deere’s steel plow & McCormick reaper

–  benefited cities; especially Chicago –  stimulated the iron industry & banking –  economic linking of N & W


3

Foreign Trade •  Generally a net importer (exporter of raw

materials) •  Whaling •  The Clipper Ship: only 3 months to CA •  Steam Ships: eclipsed clipper ships &

lowered shipping rates (Cunard Lines)


World’s Largest Steam Boat, the American Queen New Orleans to Louisville – One week (previously three months)

1000 accidents 1811-1850 (30% of total number of boats 57% snags; 21% explosion; 17% fire…)

The Growth of Northern Industry •  Rapid expansion •  The factory system(Lowell System)

– Textile mills created ‘ready to wear’ – Brooks Brothers 1818

•  Importance of PA coal •  Numerous invention

– Street car; sewing machine; yale locks, safety pin •  Increased incorporation •  Still agriculture dominated


4

Federal Aid for the Development of the Market Economy

•  Post Offices & Telegraphs (S. Morse 1844) •  Patent Law •  Internal Improvements •  Judiciary (Commerce Clause)

– Charles River Bridge v. Warren Bridge •  Did a corporate charter imply a monopoly?

•  Corporations (Limited Liability)


Early market economy

Documents

Transcript of Early market economy