The Beet Sugar Entrepreneurs of Antebellum America: An Industry's Failure and an Economy's Success

Posted: 30 Oct 2006

See all articles by Robert E. Wright

Robert E. Wright

American Institute for Economic Research

Date Written: October 28, 2006

Abstract

Laymen and scholars alike often lament the failure of business firms and business historians focus most of their efforts on the small percentage of successful entrepreneurs. That is unfortunate because the failure of firms often and ironically leads to the success of economies. In a world haunted by the specter of bounded rationality, asymmetric information, nontrivial transaction costs, and uncertainty, entrepreneurs test the margins of economic reality. This paper shows how early nineteenth century America's failed agricultural manias, particularly the beet sugar craze of the late 1830s, helped the burgeoning American economy to learn where its comparative advantages lay, and where they did not. Early American beet sugar is also a story of abolition and slavery, technology diffusion and confusion, laissez faire ideology and government interference in the economy, and surprisingly advanced capital and money markets.

Keywords: beet sugar, entrepreneurs, capital markets, economic growth

JEL Classification: N21, N41, N51, N61, N81

Suggested Citation

Wright, Robert Eric, The Beet Sugar Entrepreneurs of Antebellum America: An Industry's Failure and an Economy's Success (October 28, 2006). Available at SSRN: https://ssrn.com/abstract=940808

Robert Eric Wright (Contact Author)

American Institute for Economic Research ( email )

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