Something extraordinary happened to the American economy in the 1780s and '90s. There were no big technological changes — factories, steamships, and railroads were still largely in the future. Yet a burst of entrepreneurial activity led to a jump in productivity.
What brought on the improvement? A single great event: the overthrow of colonial rule. But not the economic policies of the empire, since British control in that area had not been so onerous.
The key change lay elsewhere. After all, the overthrow wasn't just a war for independence. It was also a revolution — a major change in social as well as political relations. Most colonists had seen themselves within a great hierarchical order where everyone knew their rank in society. The vast majority of people were "the vulgar" expected to show deference to their betters. Largely stuck in their positions, they sought protection in personal ties, and only noblesse oblige kept many from falling into utter poverty. The wealthy classes also sought stability over market-oriented efficiency and growth, not unlike Lord Grantham in the television show "Downton Abbey."
To read the full, original article click on this link: Why Social Mobility Is Crucial to America's Economy - John T. Landry - Our Editors - Harvard Business Review
