19th Century US: The Unstoppable Rise of the Market Economy - Essay Sample

Introduction

The market economy involves a situation where demand and supply influences decisions regarding production, distribution, and investment (Donaldson and Richard 799). Moreover, the economy gets little or no interference from the government, thus spurring growth at an accelerated rate due to quick response and implementation from individuals. Before the 19th century, America's economy was not very huge, but then something happened in this century that drastically changed the economic destiny (Stiglitz 71). The paper will explore the impact the market economy had on America in the nineteenth century in the field of agriculture, industrial development, transport, on the livelihoods of the locals, and to the rest of the world.

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Understandably, before the nineteenth century, the economy of America was relatively small with individuals practicing subsistence farming, using canoes to transport the produced goods downstream and the absence of industries to process the farm created which made it slow to manufacture (Donaldson and Richard 810). However, this would soon be changed. Farming became highly mechanized with the introduction of farm machines and new crop variety, for example, a new cotton variety to meet the growing demand (Stiglitz 89). New tools made it easy to pick and process the product into more excellent products such as clothing. The inventions brought a sigh of relief even to the women who could buy clothes for their families instead of hand knitting that was somehow cumbersome.

Further, due to the high demand, there was an industrial revolution across America hence bringing with it an improved standard of living as demand for labor increased both in the farm fields and industries. Since the manufactured goods such as refined farm produce were sent by water to various parts of the world, the market economy made it possible and necessary for the transport system to develop (Stiglitz 78). The transport system changed from the canoes that could only go downstream to steam-powered boats that could transport products to cities located upstream (Donaldson and Richard 821). Notably, there were challenges with channels as sometimes there could be ice on the path, which eventually necessitated the introduction of another mode of transport.

The market economy made America grow drastically from the nineteenth century, and this was attributed to increased innovation. Most innovators were pushed by the needs of the locals and that across the world to produce more. Many cities grew exponentially due to improved amenities like schools and hospitals (Stiglitz 83). Furthermore, the products had a ready market since the locals worked in the fields and industries, making them financially stable and thus increasing the purchasing power and, in turn, increased production (Donaldson and Richard 824). The absence of interference from the government made it easy to innovate and improve on the consumer needs. The incentives that the government gave in terms of large tracks of land and capital aided in the increased production. The high demand for labor resulted in a high number of immigrants to America, thus contributing to the increased population.

Conclusion

In conclusion, the market economy has several advantages such as; accelerated innovations, increased production resulting in faster growth of an economy, development of transport systems, and development of different products to satisfy the needs of consumers. However, the market economy can be exploitative in that; the producer determines the prices; hence there is a need to protect the consumers from unreasonable prices somehow. The consumers should also be aware of the quality so that producers can be kept on toes, not to compromise on this.

Works Cited

Donaldson, Dave, and Richard Hornbeck. "Railroads and American economic growth: A "market access" approach." The Quarterly Journal of Economics 131.2 (2016): 799-858. https://academic.oup.com/qje/article-abstract/131/2/799/2606976

Stiglitz, Joseph E. "Creating the institutional foundations for a market economy." Law and economic development with Chinese characteristics: Institutions for the 21st century (2013): 71-111. https://books.google.co.ke/books?hl=en&lr=&id=p-DO1Yfy7gAC&oi=fnd&pg=PA71&dq