What was the 'Industrial Revolution'

The Industrial Revolution was a period of major industrialization that took place during the late 1700s and early 1800s. The Industrial Revolution began in Great Britain and quickly spread throughout the world; the American Industrial Revolution, commonly referred to as the second Industrial Revolution, started sometime between 1820 and 1870. This time period saw the mechanization of agriculture and textile manufacturing and a revolution in power, including steam ships and railroads, that effected social, cultural and economic conditions.

BREAKING DOWN 'Industrial Revolution'

Although the Industrial Revolution occurred approximately 200 years ago, it is a period in time that left a profound impact on how people lived and the way businesses operated. Arguably, factory systems developed during the Industrial Revolution are responsible for the creation of capitalism and the modern cities of today. Production efficiency improved during the Industrial Revolution with inventions such as the steam engine, which dramatically reduced the time it took to manufacture products. More efficient production subsequently reduced prices for products, primarily due to lower labor costs. Cheaper steel prices encouraged the development of infrastructure such as railroads and bridges during the American Industrial Revolution.

Increased Employment and Innovation

The Industrial Revolution created an increase in employment opportunities. As factories became more prolific, managers and employees were required to operate them; this had a flow-on effect of new and innovative products emerging. Increased innovation led to higher levels of motivation and education that resulted in several ground-breaking inventions that are still used today such as the telephone, X-ray, light bulb, calculator and anesthesia. The Industrial Revolution improved people’s lives. Due to Industrial Revolution advancements, there were improvements in nutrition, health care and education.

Pitfalls of the Industrial Revolution

Several major pitfalls developed as the Industrial Revolution progressed. There was a reduction in agriculture as people were abandoning their farms to work in city factories where they could earn a higher income. This led to a shortage a food produced on farms. Increased pollution was a pitfall of the Industrial Revolution. Before the sharp increase in factory numbers, there was a limited amount of pollution generated in the world as production was predominantly manual. The Industrial Revolution provided an incentive to increase profits, and as a result, working conditions in factories deteriorated. Long hours, inadequate remuneration and minimal breaks became the norm. This subsequently led to health issues for many factory workers. Labor movements in the United States developed momentum from the late 19th century in response to poor working conditions that developed during the Industrial Revolution.

RELATED TERMS
  1. Efficiency

    Efficiency is a level of performance that uses the lowest amount ...
  2. Factory Orders

    An economic indicator that reports the dollar level of new factory ...
  3. Communism

    Communism is an ideology that advocates a classless system in ...
  4. Marxism

    A social, political and economic philosophy that examines the ...
  5. Capitalism

    Capitalism is an economic system whereby capital goods are owned ...
  6. Old Economy

    Old economy is a term used to describe companies that enjoyed ...
Related Articles
  1. Insights

    Industries That Will Never Go Away

    A list of industries that will not perish anytime soon, as they provide and feed our basic needs.
  2. Personal Finance

    Save Money the Scottish Way

    Take a trip through history to learn from some (in)famously frugal Scots.
  3. Tech

    The Fourth Industrial Revolution: Rise of the Machines

    That guy from the Black Eyed Peas, a robot, and the prime minister of Canada walk into a ski chalet. What do they talk about? The answer: the "fourth industrial revolution."
  4. Investing

    A Primer On The Railroad Sector

    The railroad industry might seem antiquated, but it remains an important service that reaches all corners of the country.
  5. Insights

    The Toilet Revolution: Turning Waste Into Profit

    The lack of proper sanitation in developing countries has led to a public health crisis, one in which the toilet revolution could end.
  6. Insights

    Smart Farming Technology Storms Silicon Valley

    Silicon Valley may be known for growing tech startups, but now the iconic region is welcoming an entirely new breed of residents, startups focusing on smart farming.
  7. Small Business

    Understanding Externality

    An externality is a consequence of an economic activity that is experienced by unrelated third parties.
  8. Insights

    The 3 Industries Driving China's Economy

    Read an analysis of the Chinese economy and its major sectors, particularly after a series of pro-market reforms took place in China in 1978.
  9. Investing

    Should You Invest In Agricultural Commodities And Stocks?

    With rising food prices and a booming agricultural industry, we look at whether the current market is a good investment opportunity.
  10. Insights

    Industrials Sector: Industries Snapshot (XLI, BA)

    Discover the 12 industries that comprise the industrials sector of the Standard and Poor's 500 Index, and learn which key companies could help your portfolio.
RELATED FAQS
  1. How does industrialization lead to urbanization?

    Discover the connection between industrialization and urbanization and learn how economic growth increases the demand for ... Read Answer >>
  2. What is 'capital' in relation to the factors of production?

    Find out what economists mean by physical capital, how it contributes to the productivity of labor and why it is a crucial ... Read Answer >>
  3. What is the point of agricultural subsidies?

    Read about the historical origins of agricultural subsidies, and find out why the government spends hundreds of billions ... Read Answer >>
  4. What are some advantages of a market economy over other types of economies?

    Learn what a market economy is, the main assumption behind a market economy and some important advantages it has over other ... Read Answer >>
Hot Definitions
  1. Return On Equity - ROE

    The profitability returned in direct relation to shareholders' investments is called the return on equity.
  2. Working Capital

    Working capital, also known as net working capital is a measure of a company's liquidity and operational efficiency.
  3. Bond

    A bond is a fixed income investment in which an investor loans money to an entity (corporate or governmental) that borrows ...
  4. Compound Annual Growth Rate - CAGR

    The Compound Annual Growth Rate (CAGR) is the mean annual growth rate of an investment over a specified period of time longer ...
  5. Net Present Value - NPV

    Net Present Value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows ...
  6. Price-Earnings Ratio - P/E Ratio

    The Price-to-Earnings Ratio or P/E ratio is a ratio for valuing a company that measures its current share price relative ...
Trading Center