First Industrial Revolution
The first industrial revolution, taking place in 1765, transformed our economy from industry to agriculture, allowing many manufacturing processes to become mechanized. Discoveries including coal extraction processes, the steam engine, and spinning machines would change the way that goods were produced. Industrialization was made possible by increases in productivity, investment, business expansion, and the rise of corporations. For America, a relatively new country at the time, economic growth was largely a new concept which would be explored further in the years to come.
Second Industrial Revolution
A full century later, another industrial revolution occurred, this time introducing electricity, gas, and oil. Importantly, huge changes in economic thought and policy occurred as well. Economists derived the “labor theory of value”, a contrasting idea to previously defined supply and demand principles. They worried about population growth, increased poverty, and other issues brought up by urbanization and industrialization. Many fundamental ideas including the causes of economic growth, the value of currency, and the introduction of a free-market economy all surfaced during this time period. However, though there was an abundance of social issues that came up during the second revolution, policy makers had extremely opposing beliefs – one side arguing for social reform and the other stressing the importance of economic growth.
Third Industrial Revolution
The third industrial revolution introduced America to electronics and nuclear power. Though there was another economy and productivity boom, as well as improved living conditions and lower priced goods, this revolution brought extreme unemployment.
Fourth Industrial Revolution
We are living and breathing the fourth and most recent industrial revolution, otherwise known as the “age of the internet”. We are experiencing patterns in employment similar to those observed during the previous industrial revolutions. However, many economists are to how past major transformations in work tasks and labor markets did not lead to major social chaos or disruption. These economists say that when technology destroys jobs, people find other jobs. And to a certain extent, the economy has proven itself able to readjust to innovation.
But how much will inequality and unemployment rise before the United States realizes that economic reform is needed?
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