Quite by accident, I came upon an especially interesting essay by John Steele Gordon (author of An Empire of Wealth: The Epic History of American Economic Power), now featured at the Imprimis website, an online magazine published by Hillsdale College.
“Nothing encourages entrepreneurial activity more than the freedom to take risk. Consider one of my favorite early American entrepreneurs, Frederic Tudor. In 1806, he decided to sell ice. He wanted to get it where it was cheap, New England, and sell it where it was dear, the Southern states and the West Indies. Everyone laughed. But his secret was a waste product that a great New England industry was more than happy to supply him with for free—sawdust, an excellent insulator. So Tudor combined two cheap things and made them valuable simply by moving their location. By 1820 he was shipping 2,000 tons of ice a year to as far away as Calcutta, getting as much as 25 cents a pound. By 1850, ice was one of New England’s largest exports. By 1900, of course, the trade was dead, thanks to the invention of refrigeration. We call that creative destruction.”
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To read the complete article, please click here.
To learn more about John Steele Gordon, please click here.