The Enclosure Acts and Rise of Economic Liberalism

The shift from communal land use to private ownership, known as the Enclosure Acts, led many rural laborers to seek work in urban centers. This transition coincided with the mechanization of large farms, increasing productivity and profitability. By removing the fallow system, enclosed pastures further boosted agricultural output and farmer incomes. This agricultural development spurred industrial growth.

Economic Liberalism

Economic liberalism is an economic system characterized by private property, free enterprise, and free markets. Its theoretical foundation is rooted in the ideas of thinkers like Adam Smith.

Theoretical Basis of Economic Liberalism

Adam Smith argued that individual self-interest drives economic activity. He believed that wealth originates from human labor, not merely the accumulation of money or land. Smith also distinguished between use value and exchange value. He held an optimistic view, suggesting that free private initiative would lead to continuous growth benefiting everyone. David Ricardo emphasized the importance of free trade in agricultural products between countries. John Stuart Mill synthesized classical liberalism, advocating for individual initiative, capital accumulation, and free market competition.

The Industrial Revolution facilitated the triumph of capitalist economic systems based on liberal economic theories. Cottage industries were replaced by mass production, giving rise to an industrial society characterized by distinct social classes and social welfare considerations.

Key Concepts

• Division of Labor: Each worker specializes in a specific stage of the production process.
• Law of Supply and Demand: The price of a product is determined by the balance between the quantity available and consumer demand.

Class Society

The Industrial Revolution and associated political changes led to the emergence of a new social structure based on open social classes: lower, middle, and upper.

• Lower Classes: Composed of poor peasants lacking land and, significantly, the proletariat – industrial workers including men, women, and children who often faced harsh working conditions.
• Middle Class: Experienced growth, including skilled workers in the expanding industrial sector and a burgeoning service sector.
• Upper Classes: The traditional nobility declined in influence, replaced by the bourgeoisie, who concentrated political and economic power through commerce, industry, and modern agricultural practices.