Factory System During The Industrial Revolution

596 Words3 Pages

The factory system that was created during the Industrial revolution had many positive effects on the economy. It increased wages, allowed the production of goods to be faster, and allowed more goods to be produced. The Industrial Revolution was a time where the transition to a modern industrial society made the economy rely more on modern machines instead of tools. There were remarkable changes that occurred in the economic structure due to the creation of the factory system. The factory system changed the economic structure because it forced workers to be dependent on the employer. The factory system changed economic activity from agriculture to manufacturing. The overall amount of goods and services produced expanded dramatically. …show more content…

The factory system assisted the economy to grow because the previous system was falling behind as it tried to provided for the great demand of goods. The rising middle class also helped for the factory system because those people could afford more expensive goods like cotton ore china. It occurred to traders that they could mass produce goods in greater quantity at a cheaper price, they could find more consumers and make a higher profit. Cycle works as follows: increased consumer demand prompts entrepreneurs to invest in machines to speed up production, and thereby increase profit. Profit from increase production used to invest further innovations and inventions. Factory systems were so good because of the efficiency, productivity, and quality control of a factory was because of the division of labor. This was a process by which the key tasks in manufacturing were identified and assigned to individual workers to specialize, perfect and repeat with dispatch. Introduction of financial innovations such as stock markets, joint stock companies, and national banks were all instruments for a new free-market economic system that had been evolving over centuries. The feudal system was the old system. Buyers and sellers (private business owners) satisfy their own interests by voluntarily agreeing to exchange money for a product. Business owners compete in a free market to make the best product or service at a price that will attract the most buyers. The successful businesses grow larger and employ more workers, thereby growing the economy. Proponents of the free market believe that this system encourages innovation, high quality goods, and increases the wealth of countries. The government does as little as possible in a free market economic

Open Document