Economic history Essay Example | Topics and Well Written Essays - 500 words

Economic history - Essay Example The growth of the United States economy in the period from 1790 to 1860 can be seen in terms of an expansion and a growing complexity (Suranovic, 1997). The local market relations that existed before canals and railroads were personally run on trade and a mixture of cash and barter. With the growth of the South’s cotton industry in the period after 1815, the country branched out and developed an interregional trade system that was structured around a growing number of banks and currency (Whitman, F.K., 2000, p. 535). Between 1807 and 1815, U.S. foreign trade was severely disrupted by Jefferson’s trade embargo, subsequent non-importation measures, and the War of 1812. These disruptions are commonly believed to have spurred early U.S. industrialization (Zuckerman, 2006). Because of the aforementioned disruptions, especially the embargo, domestic industry was encouraged and emerging local industries were protected from import competition by preventing foreign manufactured goods from reaching the U.S. market (Davis, J.H., 2003, p. 228). Due to the resulting trend of interregional trade, new manufacturing firms were established and existing domestic producers rapidly expanded output to replace previously imported goods (Zuckerman, 2006). Interregional trading also led to the American economy becoming industrialized, first in the Northeast, in order for inter-region commerce to become more convenient (Herbst, 1997). New inventions and capital investment led to the creation of new industries and economic growth. As transportation improved, new markets continuously opened. The steamboat made river traffic faster and cheaper, but development of railroads had an even greater effect, opening up vast stretches of new territory for development. Furthermore, the United States became an economic power with the dramatic expansion of domestic markets, as the set of regional