Industrial Capitalism And The Economic System - 1433 Words

Panic of 1873 HIST 101 Industrial capitalism is defined when the economic system is based on trading products and operations for profit. This allowed people to have their private property, wage labor, a price system and created competitive markets. Behind the Panic of 1873, the American society was heavily relied on mercantile capitalism. Mercantile capitalism is the earliest capitalism to be ever created in the development of capitalism as an economic system. Mercantile capitalism is heavily dependent on local markets, which developed in early 9th century and in medieval Europe from the 12th century. As people were having their own private properties, and have more money to trade products in big scale and were able to produce products in mass scale, industrial capitalism has been created that continues to this day. The panic of 1873 is the first global depression that was occurred by new idea of industrial capitalism. The key to industrial capitalism is a boom and bust cycle. Boom and bust cycle is occurred by the process of economic expansion and contraction that occurs repeatedly. During that cycle, booming phase is when the economy is growing, jobs are growing and the market is brining high returns to the investors, which â€Å"booms† the economy. Consequently, the downfall of boom and bust cycle which is bust, can cause inflation to decrease, unemployment to increase, incomes fall and demands decreases. The panic of 1873 is the first global depression that was occurredShow MoreRelatedCapitalism Vs. Socialism And Communism1175 Words   |  5 Pages Capitalism VS. Socialism/Communism Analysis The industrial revolution changed the way people lived. Before the industrial revolution all the work that is now done by machines was done by hand. It also allowed the ambitious working class man to join the rich at the top. 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