<P> Famed Merchant Francis Cabot Lowell memorized the designs of British textile machines in 1810 and realized that, during the War of 1812, demand for domestic finished cloth increased as imports were drastically cut through embargoes . When he returned to the United States, he set up the Boston Manufacturing Company, which employed the famed Lowell system as a response to poor working conditions in England, initially employing many women . His company was massively successful and extremely productive, especially because his competitors continued to use labor - intensive methods while he employed the mechanized spinning jenny and the water frame . The systems developed by the Boston Manufacturing Company and Lowell himself, such as vertical integration and mass production, found replicas across the country as the United States began to recognize the need for economic independence and industrial development in the wake of the Embargo Act of 1807, which highlighted the country's long - term reliance on the British Empire for trade in important refined resources . Since it became clear the U.S. had relied too heavily on foreign refinement of resources, entrepreneurs such as Oliver Evans, Robert Fulton, and Matthias W. Baldwin capitalized on this mostly new industry and mechanized refinement and transportation, thereby drastically increasing the economic independence of the United States for resource refinement and fueling the war effort against Britain . </P> <P> The Financial Sector also saw increased support during the war, once the charter of the First Bank of the United States' charter expired in 1811, it became clear that the U.S. Government would have trouble financing the war without it, which lead to the ultimate renewal of the bank by President James Madison in 1816 . There were 3 separate incidents of financial downturn in the early 19th century: the Embargo Act of 1807, the Depression of 1818 - 21 and the Panic of 1837, each requiring the financial sector to employ new strategies to deal with large - scale financial downturn never before seen in the United States in the fashion presented during that period . </P> <P> The Industrial Revolution permanently altered the U.S. economy and set the stage for the United States to dominate technological change and growth in the Second Industrial Revolution in its Gilded Age . The American System (economic plan) gave way to new economic thought such as the classical school of economics which assisted in the growth of trade and commerce, but this time with the U.S. as a much larger exporter than importer, which would continue until the late Cold War era with the drastic increase in imports from China . The Industrial Revolution also saw a decrease in the rampancy of labor shortages which characterized the U.S. economy in the late 18th and early 19th centuries . This was because there was a "transportation revolution" that happened in the same period, which was massively important due to the sheer size and low population density of the U.S. at the time, connecting population centers such as through the Wilderness Road and the Erie Canal, coupled with the development of Steamboats and Rail transport, allowing for the phenomenon of urbanization to begin which increased the labor force available around larger cities such as New York City and Chicago, ameliorating the classic American labor shortages of the time . This also allowed for the quicker movement of resources and goods around the country, drastically increasing trade efficiency and output, while allowing for an extensive transport base for the U.S. to grow from in the Second Industrial Revolution . </P>

When and where did the industrial revolution begin in the united states