The North had both an agricultural and an industrial economy utilizing free labour while the South concentrated on a plantation economy is true but withal insufficient. The salary of a working man in the South was sometimes as much as ten times higher than the one of his counterpart in the North due to: The fact that plantation offered white workers a steady supply of well-paid job white work consisted in managing black slaves so had a manager pay. The cost of living in the South was significantly higher than in the North due to greater costs to bring food and other necessities from the North and the exceptional buying power of the workers in the big plantations. On the other hand the North, with a steady supply of cheap labour from Europe and the countryside (mechanization in the field meant less labourers were required so many moved to Chicago and New York City). As a result, an entrepreneur would rather develop his factory where the wages were low rather than in the South, where the salary of a single Georgian could cover the wages of up to ten workers in Illinois. Furthermore, frugal workforce denoted that it was more frugal to build infrastructures such as railroads, bridges and canals in the North. These infrastructures in turn denoted that the price of everything would be decrementing in the North. So you'd have a virtuous cycle in the North with low labour costs bringing industrialisation and keeping labour costs low. With the country expeditiously expanding in land, population, and industry, major differences developed in the economic culture of each section of the country. During the development of the thirteen colonies, diversity set in early. In the South the moderate climate made the growth of tobacco a suitable and very profitable business. Growing this crop required a lot of land, and therefore settlers lived far apart. Northern colonies, though, were much more dependent on small farms, with closely knit communities. During the 1800s the South remained almost completely agriculture, with an economy and a social order largely founded on slavery and the plantation system. This set-up produced the staples, especially cotton, from which the South derived its wealth. The North had its own great agricultural resources, was always more advanced commercially, and was also expanding industrially. As time went on the United States of America grew as two separate nations. The Industrial Revolution gave Northern living its own culture, as the development of machinery and capitalism took hold. The South, however, was holding on to it’s own institution of slavery. As the demand for cotton grew, the South became more and more dependent on slavery