Book Description

The United States differed dramatically from Britain in the way manufacturing was organized during early industrialization. Even before widespread mechanization, American production was almost exclusively from centralized plants, whereas the British and other European economies were characterized by extensive cottage manufacture. This paper argues that this contrast was rooted in a salient disparity between the land-to-labor ratios of the two countries. Together with its later settlement, the relative abundance of land in the U.S. led its agricultural sector to be much less concentrated in grain than was British agriculture. Since the labor requirements of grain production were much more seasonal than were those of the other major agricultural products of the era (dairy products, livestock, wood, and cleared land), and agriculture was the dominant sector in both economies, there were more seasonal fluctuations in British labor markets than in the American. We argue that this difference in the extent of seasonality is crucial, because cottage manufacture had a relative advantage in the use of offpeak or part-time labor. Quantitative evidence and a general equilibrium model are employed to present the analysis, and subject it to tests of consistency with the empirical record.