Between 1840 and 1860, what were the differences in the economies of the North and South? How did slavery relate to the southern economy? What were the consequences of the peculiar institution on the South? At the outset of the Civil War, how were these economic differences discernible?

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In 1800, the economy of the entire United States was agricultural. In 1860, the South's economy was still agricultural, but the North's economy was diversified. The South's economy relied heavily on slave labor, and the issue of slavery caused the Civil War (1861–1865).

In the decades before the Civil War, the North's economy developed rapidly. By 1860, the North had about 90 percent of the manufacturing industries in the country. When war came, the North was able to produce weapons far more easily than the South could. Only about 40 percent of Northerners worked on farms, and these farms were more mechanized than those in the South. The urbanized North had a much larger population than the rural South.

In 1860, the South possessed great wealth. But that wealth was derived almost solely from its slave economy and its product: cotton. The South had less than 30 percent of the nation's railroad tracks and only about 10 percent of the nation's banks.

As the war dragged on, the North's economy gained strength. The South's economy could not withstand the strains of modern war. Moreover, large areas of the South were overrun by Union troops, and that made it even more difficult for the South's wartime economy.

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There were significant differences between the northern and southern economies between 1840 and 1860, and slavery played a role in shaping these differences. Because of a good climate, longer growing season, and the availability of very fertile land, the South had developed as a region with agriculture as its main industry. The availability of slaves intensified the development of farming as the main industry in the South. This allowed large southern plantation owners to obtain and maintain a labor force while keeping these costs under control.

In the North, many industries developed. Because of the availability of many natural resources, along with poor soil and a shorter growing season, many northerners turned to industrial pursuits to make a living. While some farming was done, it was far less than what was occurring in the South. As a result, few slaves were needed. Shipbuilding, fishing, and manufacturing were some of the main jobs in the North.

The institution of slavery hurt the South in many ways. A system of racial superiority developed in the South. African Americans weren’t viewed equally by white southerners, whether the African Americans were free or were serving as slaves. The southern economy was not very diversified because so many resources went into farming and owning land. This became an issue when the Civil War started.

As a result, by the time the Civil War began, the North had more miles of train track and a higher production of industrial products. This gave the North a decided advantage over the South. It was easier for the North to manufacture products for the war and to transport war materials by train. The North also had more ships that could help transport products and that could be used by the navy. The North had more raw materials that aided them in making products for the war effort. As more and more states in the North outlawed slavery, the North had more people that could serve in the military. The North had a larger population than the South, and the South’s general unwillingness to use slaves as soldiers made it more difficult for the South to get soldiers that could fight. When the Civil War began, the South had a significant military disadvantage.

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