The terms ‘capitalism’ and ‘socialism’ had their origins in the British Industrial Revolution. As the Chicago economist Thorstein Veblen argued, nineteenth-century capitalism was an authentically Darwinian system, characterized by seemingly random mutation, occasional speciation and differential survival. Yet precisely the volatility of the more or less unregulated markets created by the Industrial Revolution caused consternation amongst many contemporaries. Until there were significant breakthroughs in public health, mortality rates in industrial cities were markedly worse than in the countryside. Moreover, the advent of a new and far from regular ‘business cycle,’ marked by periodic crises of industrial over-investment and financial panic, generally made a stronger impression on people than the gradual increase in the economy’s average growth rate. Though the Industrial Revolution manifestly improved life over the long run, in the short run it seemed to make things worse.
