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In addition to the rise of industrialism, periods of prosperity have brought out amazing works of literature, often in criticism of the carelessness of the time. The Great Gatsby is a powerful example, as is Sinclais Lewis' Babbitt. Both are biting studies of character and how sudden wealth can affect one's personality. Also, periods of prosperity give rise to books designed more for entertainment. This speaks more toward popular culture I suppose, but an example would be the increase in popularity of "genre fiction" (usually mystery, suspense, sci-fi, horror) in the 1980's.
Finally, as our economy shifts again towards an ever-increasing reliance on technology, I believe we will see (& perhaps are already seeing) a decline in literature. As "social-networking" sites, text-messages, etc. take over our information gathering and entertainment methods, the publishing industry suffers. I hope that this will pave the way for electronic authors to change the face of American literature once more.
This is very interesting question indeed. Economic change always impacts American society, and it has influenced the development of American literature, since literature reflects the society in which it is created.
Consider, for example, the country's shift from an agrarian economy to industrialization. As people moved off their farms to settle in cities and as those cities swelled with immigrant populations, American literature moved away from Romanticism into Realism, with post-Civil War local color writing serving as the bridge. The new economy produced profound changes in American society; urban poverty, for example, became part of the fabric of American life and capitalist greed ran rampant. The Muckrakers, American writers and journalists, exposed these conditions. Upton Sinclair's novel, The Jungle, is an example of this influence reflected in American literature, as is Stephen Crane's Maggie: A Girl of the Streets. Economic changes were occurring at the same time in the Midwest as fewer people owned more of the land, leaving behind the days when a small family farmer could prosper. These conditions were addressed by Hamlin Garland, for example, in his short story, "Under the Lion's Paw," another good example of American Realism in literature.
As the century developed and the economic boom of the 1920s arrived, these economic changes were reflected most famously in Fitzgerald's The Great Gatsby. When the economic bubble burst and the Great Depression arrived, another American Realist, John Steinbeck, incorporated it into our body of national literature with The Grapes of Wrath. Another Steinbeck novel, Of Mice and Men, addressed the changes in the American economy that favored the wealthy at the expense of the working poor.
Fitzgerald and Steinbeck both explored the American Dream in terms of money and its impact on lives, two of numerous American writers to do so with the rise of Realism.
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