3 two new phenomena emerged:
Economic liberalism, the father of economic liberalism was Adam Smith
He argued that the market supported itself by:
-free competition: law of supply and demand -
-division of labor multiply productivity.
Industrial Capitalism, industrialization led to a shift from commercial capitalism (where the trade had been the most important source of profit) to industrial capitalism (industrial production became the most profitable economic activity in a country. The industry needed large investments, with the use of stock markets and banks).
-The common characteristics:
-Served the interests of wealthy capitalists and business owners.
-Were aimed at generating profits that could be reinvested in business.
-Led to an increase in social inequalities.
THE SOCIAL CONSEQUENCES OF THE INDUSTRIAL REVOLUTION*
A class-based society:
-Three groups: upper (nobility, bourgeois capitalists), middle (civil servants, lawyers, doctors, small merchants and artisans, small farmers) and working class( proletariat and poor tenant farmers and agricultural laborer's).
-The social class of people was determined by their profession and wealth,
-Society was open: people's social class could change if their personal situation
-In theory, all citizens were now equal before the law.
-In practice, there were large economic inequalities.