The Industrial Revolution

Mercantilism (an economic theory): a nation should maintain and increase its wealth by exporting more than it imports
1. Kings encouraged policy of importing raw materials and exporting finished goods
2. British government put guild restrictions on the amount of material produced to limit competition and keep the economy stable and safe
  1. Limits brought decline of mercantilism since demand for better access to more goods rose
    1. Cottage industry
Cottage industry: merchants, the capitalist (person with excess money/capital) would invest capital and act as coordinators between buyers and sellers while skilled rural workers manufactured cotton and wove cloth
1. System called commercial capitalism
2. Merchants...
  1. Buy and sell goods, and take all the risks
  2. Buy raw materials (cotton and wool) and give them to rural workers (usually women)
  3. Didn't need to buy equipment
  4. Went from worker to worker and the product was gradually completed
  5. Sold the finished products
3. Workers...
  1. Controlled their income
  2. Were paid by the piece
  3. Could work from home
4. Houses were small, crowded, and poorly ventilated
5. Colonies provided a market for goods
6. By the 18th century, there were no more guild restrictions so more goods were produced
7. Merchants had more money to invest
  1. More goods = more money
    1. More money = more products
      1. This process repeats and the economy grows
There was a move from regulation of trade to a free market
1. Capitalism: a system in which the decisions for production and distribution are made by an induividual using personal capital for personal gain
  1. Advantages
    1. Free competition
    2. Open market
    3. Private ownership
    4. Workers paid wages and could compete for jobs
    5. Control over the economy lay with the private rather than government sections
  2. More people = more demand = need for faster production
    1. Spinning Jenny (could spin 16 threads at a time)
    2. Water frame (improved spinning wheel and created much stronger yarn)
      1. Too big for a house
        Needed to be housed by a factory
        The factory system
        Mule (could spin strong yarn still thin enough for fine fabrics), power loom (quickened the weaving process) and cotton gin (separated cotton from seeds)
        Machines became larger, faster and more expensive and were operated by power rather than by hand
        Factories located where coal, iron and water were available
        Workers...
        Had to leave their homes
        Didn't make the whole product, only a piece of it
        Lost autonomy (factory owners now in charge
        Were controlled by employers (wage, hours and working conditions)
        Division of labour
        England became the cotton manufacturing center of the world
        Changes in energy/power sources
        More power needed = new source needed
        James Watt invented the steam engine
        Required coal
        More coal needed
        Factories could be built in more paces since only coal was needed
        Coal and iron industry
        Farming tools, machines and railroads made of iron
        Increased demand for iron
        Smelting: a chemical process where impurities are removed from iron ore to make durable steel
        Bessemer process reduced smelting time from 7/8 days to 30 minutes
        Britain had a limited timber supply but a huge coal supply
        Coal replaced timber
        Charcoal became more expensive
        Charcoal replaced by coke (coal with gases burnt off)
Industrialism: an economic and social system based on the development of industry and marked by the production of manufactured goods and the concentration of employment in urban factories
Solutions to problems
1. Public Health Act of 1875 (clean, light and pave streets, appointed medical officer/public officer of health)
2. Public baths and wash-houses set up
3. Sales of food containing harmful substances (like formaldehyde, used to preserve milk) banned
4. Soup kitchens set up by Quakers
5. Metropolitan Police Force set up by Sir Robert Peele in 1829
6. Previously, only male British landowners could vote on members of Parliament
  1. Reform Act of 1832 (industrial centers now had a voice in the government
  2. Reform Act of 1867 (gave working men the right to vote)
7. Bad working conditions
  1. Committee set up to collect evidence about treatment of children in factories
  2. Althorp's Act of 1833 (limited working hours of children)
  3. Factory Acts (further limited the working hours of children, required school attendance and fences around factory machinery)
  4. 1842 - mine owners prevented from employing women, girls and boys under 10
  5. Unions and strikes
Why Great Britain?
1. Geography - since GB is separated from the continent, it was not involved in any wars
2. Government - stable and recognized importance of international trade
3. GB had 5 factors of production (market, capital, labor, stable government and raw materials)
4. Strong navy
5. GB law required merchants to use British ships for trade
Transportation
1. More demand for goods = more demand for raw materials
  1. Factories needed more raw materials and the ability to export more in order to keep profits high
    1. Canals built
    2. Parliament passed over 500 laws to create more and better roads in 1770
    3. System of railroads developed
      1. Railways - cheaper and faster
        Contest for the best steam engine
        The Rocket
        Faster and cheaper trains
        Quicker imports and exports in bigger volumes
        Faster profits = more money to invest
        England's economy quickly improves
2. Previously...
  1. Horses/mules carried goods (needed dry/thaw ground and goods often damaged)
  2. Trade was usually within a small area

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