Chapter : 1. The Making of a Global World
Rise of Mass production and consumption
Rise of Mass production and consumption : The US economy resumed its strong growth in the early 1920s. One important feature of the US economy of the 1920s was mass production.
A well known pioneer of mass production was the car manufacturer Henry Ford. He adapted the assembly line of a Chicago slaughterhouse to his new car plant in Detroit. He realised that the 'assembly line' method would allow a faster and cheaper way of producing vehicles. The assembly line forced workers to repeat a single task mechanically and continuously - such as fitting a particular part to the car - at a pace dictated by the conveyor belt. As a result, Henry Ford's cars came off the assembly line at three-minutes intervals, a speed much faster than that achieved by previous methods. At first workers could not control the pace of work. So they quit in large numbers. In desperation Ford doubled the daily wage to $ 5 in January 1914. He recovered the high wage by repeatedly speeding up the production line and forcing workers to work ever harder. Thanks to higher wages, more workers could now afford to purchase durable consumer goods. There was a spurt in the purchase of refrigerators, washing machines, radios, gramophone players, house construction and home ownership, all through a system of 'hire purchase'.
The housing and consumer boom of the 1920s created the basis of prosperity in the US. In 1923, the US resumed exporting capital to the rest of the world and became the largest overseas lender. US imports and capital exports also boosted European recovery and world trade and income growth over the next six years. The housing and consumer boom of the 1920s created the basis of prosperity in the US. In 1923, the US resumed exporting capital to the rest of the world and became the largest overseas lender. US imports and capital exports also boosted European recovery and world trade and income growth over the next six years.
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