The Market Revolution, Industrialization, and New Technologies

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What are the four factors of industrialization?

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Factors that influence industrialization include natural resources, capital, workers, technology, consumers, transportation systems, and a cooperative government.

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In addition to the previously mentioned factors, four other factors of industrialization are internal demand, a high birth rate, available land, and innovation.

Internal (or domestic) demand is an important factor of industrialization. This demand is a combination of consumption and investment. If there is a great deal of domestic demand for certain goods, then it makes logical economic sense to work toward manufacturing those goods.

This is one of the reasons why, as mentioned by other educators, a large population is also a factor of industrialization. Countries with more people are more likely to have a higher internal demand for goods and thus are more likely to work toward meeting those demands. One of the causes of a growing population that is also a factor that leads to industrialization is a high birth rate. As more people are born into a country, that country’s population expands, and there is going to be an increasing number of consumers. A growing population also means there will be more people to work.

In addition to people, available land is also necessary in order for industrialization to occur. Without land, there would be nowhere to build factories or other large facilities necessary for industrial production. Land is also a source of vital natural resources like coal and water.

Finally, innovation is also often a significant factor that leads to industrialization. For example, technological innovations like the development of new machinery can help produce new products. However, innovation in how things are done can also be impactful. For example, the design of the assembly line helped propel industrialization in the United States.

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Economists and historians identify many factors that must be in place for industrialization to flourish. Let's explore a few of them.

First, industries need natural resources, the raw materials used to produce finished products. Whether those resources are oil or steel, coal or wood, or water for transportation and power, they are vital to the success of industry, for without them, factories cannot run.

Second, industries need capital, the money required to acquire natural resources, build factories, and hire workers. A stable currency is also necessary for people to be able to purchase goods produced by industries.

Third, industries need workers. Without a steady labor force, factories would not be able to produce even if they had all the natural resources and capital in the world. As American industrialization increased, workers were recruited from the many immigrants who came to the US looking for opportunities and from groups like women and children.

Fourth, industries need technology. Advanced machinery, assembly lines, power sources (water, steam, electricity), standardized parts, and communication improvements all led to increased industrialization and greater efficiency.

Fifth, industries need consumers. If no one buys an industry's products, there is no reason to continue making those products, and the industry will fail.

Sixth, industries need transportation systems so they can bring natural resources into their factories and send their products to consumers. Roads, rivers, canals, and railroads have all contributed to the transit needed to boost industrialization.

Seventh, industries need a cooperative government that will support their efforts. Industrialization is especially aided by high tariffs that encourage consumers to purchase goods made in their own country, low taxes, and a laissez-faire (hands-off) policy in which the government basically leaves industries alone, or at least limits its regulations.

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There are several factors that led to industrialization. One factor is the availability of natural resources. Natural resources are needed to help make the products produced in the factories. A second factor is having a stable political environment. With a stable political environment, business owners can be more confident that they can invest in the economy and know that investments will be secure. A stable political environment tends to lead to stable markets that help businesses and the economy grow.

There are other factors that also lead to industrialization. One of those factors is a growing population. Workers are needed to work in the factories. As businesses expand, more workers are needed. The growing population also provided an opportunity for businesses to sell their products to more people. Finally, new inventions and improved transportation helped bring about industrialization. New inventions made it easier to make products. Also, there needed to be a good transportation system to be able to get the products to the consumers. Roads, canals, railroads, and ships are various ways to transport products. New inventions in transportation, such as the steam engine, helped make it easier to get products from the factories to the people.

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Here are the four factors that gave rise to industrialization:

  1. Political stability: Countries that industrialized did so in a political environment in which the government provided stability and law. Economic instability and changing laws would have made it more difficult for capitalists to start businesses.
  2. Available work forces: Industrialization required large numbers of available workers who no longer lived in rural areas. These workers had left agricultural jobs to come to urban areas in search of employment in factories. In the United States, an increased work force was provided through immigration. 
  3. Natural resources: Industrialization required countries to possess natural resources such as steel or coal or to have access to these resources through their colonies.
  4. Expanding economy: The process of industrialization required the availability of ready capital to start new businesses. In addition, capital helped fund the development and construction of new technologies, such as railroads and factory machines, that sped up the process of industrialization. 
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There are a number of factors that lead to industrialism.  First, technologies for production are necessary.  These technologies can take the form of any mechanized machines from steam powered engines to robotics.  A second important factor for industrialization is a large population from which to draw labor and to sell finished goods.  The third factor for industrialization is the availability of natural resources that can be utilized to make finished goods.  The fourth factor of industrialization is a means for transportation to get the goods to consumers.  This can take the form of highways, but waterways like rivers and seas are more useful.  Another factor for industrialization is the presence of a stable political situation, especially one that supports the idea of manufacturing and the free market.  

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