Cottage industries preceded the Industrial Revolution

An oft-forgotten period of history in England and the United States was the putting-out system. Cottage industries served as the precursors to the factories we associate with the Industrial Revolution.

Manufacturing didn’t begin in factories. It began when technological progress allowed people to manufacture raw materials right out of their homes. Eventually, when it became politically viable to do so, larger firms formed to minimize transaction costs.

What’s my point? In contrast to what you might hear from Marxist historical narratives, Western Europe didn’t morph from feudalism to capitalism. The Industrial Revolution wasn’t a transformation of feudalistic exploitation into capitalistic exploitation. It was a spontaneously ordered progression from empowered, decentralized manufacturers.


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