Technological, Economic, and SocialDevelopment for the 21st Century
making industry less dependent on growing things, and more dependenton min- erals and on capital goods. As historian Edward C. Kirkland (1969) has put it: "The age since 1860 may have been the 'age of coal and iron' or the 'age of
petroleum' or the 'age of electricity.' It was unquestionably the 'age of the ma- chine' " (p. 300). Air-driven power drills and steam shovels were introduced in
the coal mine, and suspendedrotary drills in the oil fields. The BessemerProcess reduced the cost of steelso that its widespread usebecame practical, and later the open hearth process made it possible to use lower-grade ores.
While steel can be used to make both capital (producer) and consumergoods early in industrialization, much of it is typically used for capital goods, and the capacity to make steelreflects a rise in capital goods. Hence the amount of steel produced is often used as a gross measuresof the potential of the capital goods sector. From 1860 to 1910 raw steel production had grown to 28 million tons (U.S. Bureau of the Census, 1975, Series P265).
The production of other capital goods also grew rapidly. The value of output of industrial machinery and equipment increased from $99 million in 1879 to $512 million in 1910 (Ibid., Series,P353). In general, manufacturing production multiplied twelve times from 1860 to 1914 (Ibid., Series, PI7), and output per man hour in manufacturing doubled from 1869 to 1914 (Ibid., Series, 0685).
Another measure of industrial growth in the "age of the machine" was the increase in the amount of capital invested in U.S. manufacturing facilities. From 1850 to 1880 it grew from $533 million to almost $3 billion (Grant, 1973, p. 64). It reached $8 billion in 1900, then climbed sharply to nearly $40 billion in 1914
(Scheiber, 1976, p. 221). The importance of capital accumulation is emphasized in studies that rel.atethe
acceleration of industrialization to the increase in capital/output ratio. Between 1850 and 1900, it grew from approximately 1.6:1 to 2.9:1; in the same period, capital per worker grew from about $2,100 to $5,000 or more (Slichter, 1961,p.
A developedeconom requiresexpeditiouslarge-scalemovemenof rawma- terials, parts developedat different locations,and finishedproducts.Material andproductsin transit,like inventory,addto costs--notto production.All other thingsbeingequal,the slowerandlessreliablethe transportationt,helessdevel- oped a country.
Initiation of industrializationwasassociate withthedevelopmenof canalsas an importantmeansof transportation.Exceptduring the winter freeze,canals