The Market Revolution

Introduction

Lecture focuses on economic and social changes in the 1830s during the Market Revolution.

Focus Questions:

• What changes and innovations comprised the Market Revolution?
• How did Americans respond to these changes?

Economic Landscape (1820-1850)

• 1820: 80% of labor force in agriculture.
• By 1850: US joins England as a world leader in industrialization.
• Increase in production and consumption of American-made goods.
• Shift from agricultural economy to industrial economy.

Definition

Market Revolution: Combined effects of economic growth, transportation, and technological innovations in the early 19th century.

Changes During the Market Revolution

Labor System

• Rise of wage labor replacing family labor or indentured servitude in the North.
• Emergence of a cash economy over informal barter and trade systems.

Investments

• Both private and public investments played roles.
• States and towns used taxpayer money and private funds for infrastructure (toll roads, canals, railroads).

Transportation Revolution

• Reduced transportation costs and shipping times.
• Opened new markets for farmers and manufacturers.
• Encouraged expanded production.

Transportation Costs

• 1815: Prohibitively high land transport costs.
• Water transport cheaper but limited to certain areas.

Routes

• New York City to Chicago/New Orleans: Used to take 4 weeks in 1800, reduced to less than a week by 1860.
• Substantial reduction in time made more markets accessible.

Government Role

• State governments funded most canals (70% of funding) and half of railroad projects (50% funding).
• Federal government provided engineers, lowered tariffs on iron, and granted subsidies to railroads (e.g., free public land).

Robert Fulton & Steamboats

• 1807: Robert Fulton piloted the Clermont, a steamboat, significantly reducing time and cost of transport.
• By 1820s: Steamboats cut shipment costs and times by 90%.

Erie Canal

• 1825: New York funded Erie Canal, 364 miles from Albany to Buffalo.
• Connected Great Lakes to Atlantic Ocean through New York.
• By 1840s: Erie Canal surpassed New Orleans in trade volume.

Railroads

• Railroads appeared in the 1820s, changing speed and efficiency of transport.
• Rail networks grew from the east to the west by the mid-19th century.
• Altered regional economic and cultural balances, especially between North and South.
• By 1860: North had more extensive rail networks than the South.

Communications Revolution

• Followed the Transportation Revolution as part of the Market Revolution.
• Telegraph invented in the 1830s and 40s, redefining communication limits.
• Introduction of Morse code to be discussed next.