2.  The process by which economic activities on the earth’s surface evolved from producing basic, primary goods to using factories for mass-producing goods for consumption

3.  Industrial production began long before the Industrial Revolution  Cottage industries and community workshops were located throughout the world  Ex. Textiles were made in India on individual spinning wheels and hand looms  Ex. Textiles in Great Britain were produced in rural villages within individual homes

4.  Commercial companies, such as the Dutch and British East India Companies, laid the groundwork for Europe’s colonial expansion  They gained control over local industries in India, Indonesia, and elsewhere, profited from political chaos and played off allies against enemies

5.  During the 18 th century, markets for European goods were growing, especially in the colonies  Better machines were urgently needed, especially improved spinning and weaving machines

6.  The first steps in the Industrial Revolution did not use a revolutionary new source: the new spinning wheels were still powered by foot pedals and the new water looms were driven by water running downslope

7.  Funding inventions and supporting inventors required money  The 18 th century was marked by a flow of capital from the colonies and from global trade to western Europe

8.  The flow of capital into Western Europe enabled investors to fund inventors and perfect inventions  Ex. James Watt is credited with improving the steam engine by creating a separate chamber to house the steam and by perfecting the pistons and getting them to perform correctly

10.  The textile industry was the first to benefit from the new steam powered machines and smelting processes

11.  The first railroad in England was opened in 1825, and soon its major cities were connected by rail

12.  As industrialization diffused during the 19 th century, Britain had an enormous comparative advantage over other areas, allowing it to expand its colonial empires to further prosperity and power that came from its creator role in the Industrial Revolution

13.  Industrialization also diffused westward across the Atlantic to North America, where natural resources and available land space encouraged economic grow  The first textile mill was built in Rhode Island in 1791 by Samuel Slater, a former worker in an English factory

14.  Most industry flourished along the coast of the northeastern United States  New York City became one of the world’s greatest ports, with a huge skilled and semi-skilled labor force, and a fine natural harbor for break-of-bulk (transfer of cargo from one type of carrier to another)

15.  By the time WWI began in 1914, Europe had developed a huge industrial base, and the United States was rapidly catching up  However Industrialization had not yet diffused to the rest of the world (except for areas settled by Europeans)