Chapter 8 - The Market Revolution

I. Introduction

• The early nineteenth century marked a significant transformation in America due to commercial ambition, leading to the birth of a new commercial nation.

• The transition from subsistence farming to commercial agriculture proliferated, culminating in the Market Revolution.

• The implementation of steam power contributed to industrial growth by powering mills and enhancing national transportation networks.

• The economic landscape changed as more farmers shifted to growing crops for profit rather than self-sufficiency.

• This period saw the rise of factories and cities in the North, alongside a burgeoning middle class.

• As more individuals engaged in the cash economy, dependency on servitude began to diminish.

• However, this economic revolution led to Northern reliance on Southern slavery, generating a cycle of wealth disparity and increased demand for cotton, perpetuating slavery in the South.

II. Early Republic Economic Development

• The American economy evolved, with heightened output geared towards market demand rather than local consumption.

• Improved transportation and technological advancements facilitated a growing exchange network.

• The market revolution reflected the revolutionary generation’s vision of progress but also induced issues including class conflict, child labor, immigration, and the expansion of slavery.

• In the post-Revolution era, American exports surged, rising from approximately $20.2 million in 1790 to $108.3 million by 1807.

• High transportation costs initially impeded growth; for example, it was far more costly to move goods across land than by sea.

• The aftermath of the War of 1812 mobilized Americans to enhance infrastructure development, focusing on roads, canals, and railroads.

• Federal and state funding initiatives boosted economic construction, exemplified by increased state-chartered banks from 1 in 1783 to 1,371 by 1860.

III. The Decline of Northern Slavery and the Rise of the Cotton Kingdom

• Slave labor significantly supported the market revolution, particularly through textile production.

• Northern states began abolishing slavery gradually, exemplified by New Jersey's gradual emancipation in 1804.

• Many Northern states mandated that freed children serve indentured terms, thus prolonging the system of slavery indirectly.

• Escaping slavery was perilous, with very few enslavers opting for voluntary manumission.

• By 1830, approximately 3,500 individuals remained enslaved in the North, and emancipation proceeded unevenly.

• The invention of the cotton gin by Eli Whitney in the early nineteenth century greatly intensified cotton production, further entrenching the system of slavery in Southern agriculture.

• American cotton exports skyrocketed, with figures increasing from 150,000 bales in 1815 to over 4.5 million by 1859.

• The growing divisions between North and South were exacerbated by contrasting economic practices—rapid industrialization in the North versus agrarian reliance on slavery in the South.

IV. Changes in Labor Organization

• Industrialization shifted labor dynamics, especially in textile mills, where divided production tasks emerged.

• The putting-out system gradually transitioned to factory-based production, which relied on innovations borrowed from British textile technology.

• Samuel Slater’s contraband knowledge led to the first American textile mill in Rhode Island in 1790.

• The Lowell System, centralizing production in factories, exemplified this shift in labor organization, employing young women known as