Factors of Production

Land - space good for producing/using resources

Labor- population was growing because so was the food supply

Factors of Production

Capital- funds for investing in business

Entrepreneurship (human capital) - people with ideas and skills

Enclosure Movement

Wealthy landowners bought up smaller farms and combined them

More efficient farming (improved land)

Kicked people off their farms and sent them to cities (increased labor supply)

Factories

Made goods (mostly cloth) with machines – mass production

Much faster than cottage industry- practice of producing goods in one’s home

Long, hard, sometimes dangerous work days

Industry Comes to America

Samuel Slater, mill worker, emigrated illegally to America

Built a spinning machine from memory

Economic Ideas

Laissez-faire: “leave it alone”

Adam Smith said the government should leave business alone

Market economies have few or no government regulations

Thomas Malthus

Said population would always grow faster than food production, leading to endless starvation and misery

Social Inequality Some entrepreneurs (including bankers) became fabulously wealthy

Called “robber barons”

because they took advantage of workers

“captains of industry” because they helped the economy grow

Strongly Agree, Agree, Disagree, Strongly Disagree Inequality is a

problem for societies. Specifically, it is a problem in democratic societies.

SA/A/D/SD

An ideal society is one where everyone contributes what they can and takes what they need.

Socialism

Robert Owen’s idea Government or

society as a whole should collectively own property and industry, for the good of everyone

Set up first “utopian” communities in Scotland and Indiana

SA/A/D/SD

Americans have equality of opportunity.

Communism

Karl Marx’s idea (wrote Das Kapital with Fredrick Engle)

Capitalism leads to inequality

Eventually, workers will revolt and control the government and the economy

SA/A/D/SD

If someone is not successful in life, it is because they are lazy.

Social Darwinism

Idea that some people are more “fit” than others, so they will prosper

Based loosely on Darwin’s natural selection

Used to justify poverty and racism

Gender and Industry

Lower class: women worked outside the home (improvement for some)

Middle Class: “Separate spheres” - work and home were not the same thing anymore Men worked (in immoral business world) Women were at home (teaching morals

to children)

Effects of Industrialization Urbanization: more people moved to

cities Middle class grew Overall, standard of living increased Middle class had more free time

(leisure)