The first half of the nineteenth century witnessed a fundamental transformation of the American economy. Some historians have termed this period the “market revolution,” not because the economy had previously lacked a market orientation, but instead because market institutions developed rapidly during the period, transforming economic life in the process. The Americans of the 1850s were not just richer than those of the 1790s, but they participated in an economy that was quite different: they traveled in steamboats and railroad cars, transacted with life insurance companies, purchased goods produced by large-scale domestic manufacturers, invested with savings banks, utilized an innovative and sophisticated legal system, and even received messages via telegraph. Although the territory encompassed by the United States had expanded dramatically, the new transportation and communication networks increased economic integration, and specialized intermediaries facilitated the distribution of goods in a market that was becoming national in scope.

John Lauritz Larson's The Market Revolution in America: Liberty, Ambition, and the Eclipse of the Common Good presents a succinct and lively synthesis of the literature on the market revolution. This is of course not the first volume of its kind, and readers of Charles Sellers’ more lengthy The Market Revolution: Jacksonian America, 1815–1846 (New York: Oxford University Press, 1991) will find much of the story familiar. But Larson's Market Revolution focuses more specifically on the consequences of the market revolution for American society. In his view, the market revolution “disabled the fabric of personal, familial, and cultural connections by which people earlier had tried to mitigate the hard facts of material life” (p. 9). A communitarian society was transformed into one in which impersonal, “heartless” markets—and the inequality and insecurity they produced—became accepted as part of the natural order.

The first half of the book is devoted to the economic changes that occurred during the period, and the political and institutional developments that made them possible. This overview distills an enormous amount of scholarship into a compact and accessible narrative that could serve as an engaging introduction to the literature. Teachers of economic history may find these chapters quite useful, especially since they take up particularly interesting topics such as the rise of New York City, the evolution of the law, and the impact of technological innovations. Larson's narrative also emphasizes the impacts of major financial panics—especially those of 1819 and 1837—as flashpoints that shook Americans’ faith in markets and their ability to deliver prosperity. Of course, any brief synthesis of so large a body of scholarship is bound to oversimplify or omit some important work. That is true here, although not inordinately so. For example, Larson's discussion of the causes of the Panic of 1837 fails to mention important recent work by Jane Knodell on the effects of the destruction of the Second Bank of the United States on the boom in commercial banking in the 1830s (“Rethinking the Jacksonian Economy.” The Journal of Economic History 66, no 3 [2006]: 541–74).

The second half of the book is focused on the social and cultural consequences of the market revolution, and argues that economic changes fundamentally transformed relationships within communities and families, and undermined Jeffersonian ideals of independence. He takes up different segments of society—women, artisans, entrepreneurs, etc.—and presents a brief cultural history of each. Larson argues that the changes of the market revolution quite unexpectedly transformed American society: “market forces ripped control of material conditions out of the hands of traditional authorities—husbands, fathers, masters, community leaders, great landlords, even popular elected officials,” and completely reconfigured society (p. 166). He also examines the ideological foundations of the market revolution, and the ascendant legal doctrines and political and economic theories of that era.

The last part of the book presents a very brief overview of the current financial crisis, and examines the parallels between modern arguments about “bailouts” and the debates that followed the financial panics of the early nineteenth century. The analysis of the current crisis was written somewhat prematurely, without the benefit of the many useful books and papers on the topic that has been published quite recently, and grossly oversimplifies the many complex institutional developments that contributed to the crisis and its consequences. But the attempt to link the current crisis to the problems of the market revolution is interesting and provocative.

Larson's main argument about financial crises both past and present is that they are the outcome of economic changes that were not inevitable. In his view, the intent of the American Founders was not to create a republic of totally unfettered markets, and the market revolution itself had many adverse consequences that would have made the founders quite uneasy. He views the American Revolution as having set in motion a series of institutional and political changes that, particularly in the Jacksonian era, led to the abandonment of concerns for social welfare in popular politics. The Jacksonians are the real villains in this narrative, for they “made war on governance itself” and “canonized the doctrine of laissez-faire” in the name of freedom, a strategy emulated by American politicians ever since (p. 177). Moreover, the Jacksonian attacks on corruption and privilege, in Larson's view, crowded out more radical critiques of the market revolution itself. He concludes his book by arguing for idealistic efforts to achieve what he terms “just equality” within American political economy.