The Market Revolution, Its Impact, And Its Critics. Essay, Research Paper
An integral part of the growth of the United States into the nation that exists today was the Market revolution in the early nineteenth century. With this new change, the United States took its first step in creating the world?s strongest and most stable economy. This is of course the long term impact. There are also short term effects that were both positive and negative, such as the newly created opportunities to better one?s lives, an increase in interdependence amongst citizens, and the start of several boom-and-bust cycles. All of these events had a significant impact on the economic structure of today. As with all revolutions there are supporters and critics, two notable critics of this shift to a market economy were Thomas Jefferson and the entire Southern United States. Despite the critiques the revolution received, the market revolution was a significant first step towards creating a stable economy that allowed so much room for growth amongst individuals and a nation alike.
As a result of the transportation revolution, most Northern citizens increased their purchases of goods produced in workshops and factories, thus bringing about the market revolution. With this shift in economy, changes occurred in the society of the early nineteenth century, one being the increased opportunities for wage labor that came along with new improvements in goods and services. Because of these improvements, “by the 1840s the economy was growing at a faster rate than in the previous four decades” (Norton 179). Also an outcome of this growing economy, incomes doubled while the price of manufactured goods and food fell. This meant that the American consumer gained more buying power thus spending more money and putting more money into the economy. An increase in currency sped up the growth of our economy and essentially laid the basic principle of U.S. economic growth, spending boosts the economy. Another short-term effect of the market revolution was the boom-and-bust cycle. These were the cycles of drastic economic declines that came about with the growth. The declines were because “eventually production surpassed demand, causing prices and wages to fall?..” (Norton 179) Finally, in my opinion, perhaps the most important outcome of the market revolution was the shift to specialization of goods produced by workshops and factories. This allowed producers of goods to channel all their efforts into producing a higher quality of a single good than having to disperse their efforts in producing an assortment of lower quality goods. In the long run, specialization let to increased spending and as a result improved the economy.
Although these changes brought about by the market revolution helped strengthen the United States economy, there were still those who did not go along with the shift to the market economy, namely Thomas Jefferson and the Southern states. Jefferson had always been a strong supporter in an “individualistic” society in which strong individuals meant a strong nation. He believed that republican democracy would flourish best in a nation of independent farmers and artisans?” (Norton 180). Therefore, a market economy that promoted specialization and interdependence was the exact opposite of Jefferson?s ideal society. As for the Southern economy, its economy progressed in a different way. Instead of the planters specializing in certain crops, the invention of the cotton gin caused the majority of planters to switch to cotton production, thus all planters shifted towards a single crop. This proved beneficial to the Southern economy due to the amazing profit produced by the cotton industries low cost of production. Therefore, by their own actions, the Southern economy went against the market revolution.
Despite the opposition to the shift to a market economy, it nevertheless prevailed and remains as the most stable form of economy in the world. Today, it still follows the same principle that was established in the early nineteenth century?..spending increases flow of currency, and as a result improves an economy.