Before the industrial revolution, world market products were so wide-open for English manufacturing goods that English merchants no longer needed domestic market demand to sell their finished goods. Traditional markets all over the world were considered as non-capitalist markets, and most profit seeking English merchants strived to eliminate these non-capitalist markets' structures. Traditional markets in most countries could not compete with the English. The English had huge manufacturing advantages in comparison to non-capitalist countries, especially in the area of technological innovation. Most of England's superiorities were founded in textile and iron industries. This growing industrial prowess and capture of new markets quickly led to new sources of profits and increased potentials for capital accumulation. After the invention of steam engines, whole English lands were dedicated to the production of manufacturing products. Soon, factories were built closer to markets located in the cities rather than near rivers that were easily accessible to …show more content…
The factors of production included land, labor and capital (today's economics includes a fourth factor called "entrepreneurship"). The distribution of both actual ownership and the laws of property ownership created three main classes within the society, landlords, laborers, and capitalists. Each class received different forms of money returns: rent, wages, and profit. The level of production in any society depended on the number of productive laborers and the level of their' productivity. Productivity depended on specialization or the division of labor. The extent of the division of labor, in turn, was determined by the extent and magnitude of a well-developed market and a commercial exchange economy where specialization could increasingly take hold. The most obvious division of labor was rural agriculture-urban