The Market Revolution

Specialization• Mid-1800s

–Farmers changed from self-sufficiency to specialization

–Raised 1 or 2 cash crops, bought household goods from stores

Market revolution• Before mid-1800s:

–Markets sold very few items

–People made most items & bought what couldn’t be made at home

Market revolution• By mid-1800s:

–People bought items others made

–Specialization created efficiency

–Economy grew quickly

Capitalism• People & private businesses

own means of production–Use them to create profits–Factories, machines, land, $

Capitalism• Free enterprise

–Right to own a business• Entrepreneur

–Risk-taker working for profits–Start own business

• Could become fabulously rich• Could die penniless in a gutter

New inventions• Specialization led to lower prices

–People could afford goods for luxury & convenience

• Household inventions–Made chores easier

Agricultural inventions

• Many went from farm to factory • More food from fewer farmers

–Seed drill & metal plow–Mechanical reaper

Communication inventions

• Telegraph–Invented by Samuel Morse–1st invention giving ability to

communicate long distance

Transportation inventions

• Most important reason:–Shipping goods cheaper & easier

• Steamboats–Allowed people to get back

upstream quickly

Transportation inventions

• Canals–Shipping on water much cheaper

than shipping over land

–Ships went farther – made steamboats more effective

Transportation inventions

• Railroads–By 1860 became #1 way to travel–MUCH faster & cheaper than any

other method

New markets• Transportation allowed regions

to specialize–Could buy from elsewhere

Southern agriculture

• South looked down on northern big city factories–Filthy & overcrowded–South didn’t have $ to build

factories anyway–$ tied up in farmland & slaves

Southern agriculture

• Main cash crops:–Cotton, rice, tobacco

• 80% of cotton was sold to UK–Dependent on British economy –

if Brits don’t buy, south is sunk

Northern industry• Transportation made north rich

–Shipped southern & western goods to foreign markets

–Made $ as middlemen• Factories grew much bigger

Midwestern farming

• Inventions made it easier to grow crops

• Midwestern farms started growing cash crops–No longer subsistence farming