In 1820, the U.S. whaling industry was just a blip, generating about $1 million in revenue per year. Thirty years later, it had grown nearly 1,000%, making the U.S. the global leader in whaling. By 1900, U.S. whaling revenues had declined an astonishing 90%. What happened?
The Mysterious Decline of the U.S. Whaling Industry?
The rise and fall of America’s whaling business is a fascinating tale. It exploded in the mid 1800s thanks to a series of new technologies and rising worker productivity. Almost as immediately as it came together, the U.S. whaling industry fell apart. Many historians blame its fall on lower demand for whale oil (thanks to the rise of petroleum oil) as well as reduced supply (due to fewer whales in the ocean). But the real story behind the decline in the whaling industry is something else entirely. Here’s more on the mysterious decline in U.S. whaling from The Atlantic:
One hundred and fifty years ago, around the time Herman Melville was completing Moby Dick, whaling was a booming worldwide business and the United States was the global behemoth. In 1846, we owned 640 whaling ships, more than the rest of the world put together and tripled. At its height, the whaling industry contributed $10 million (in 1880 dollars) to GDP, enough to make it the fifth largest sector of the economy. Whales contributed oil for illuminants, ambergris for perfumes, and baleen, a bonelike substance extracted from the jaw, for umbrellas.
Fifty years later, the industry was dead. Our active whaling fleet had fallen by 90 percent. The industry’s real output had declined to 1816 levels, completing a century’s symmetry of triumph and decline. What happened? And why does what happened still matter?
…The thesis of Leviathan, the ur-text of whaling economics, is that the source of our dominance in the 19th century will feel familiar to a 21st century audience: a triumph of productivity and technology…The standard explanation for the decline of whaling in the second half of the century is a pat two-parter consisting of falling demand (from alternative sources for energy) and falling supply (from over-hunting). But according to Leviathan, the standard explanation is wrong…