The Northern states had a more industrialized economy, focusing on manufacturing, trade, and a diverse workforce, while the Southern states relied heavily on agriculture, particularly cotton, using enslaved labor. Both regions engaged in commerce and had growing populations, but their labor systems and economic structures differed significantly.
Factors leading to these differences included geographic resources (rich soil in the South for farming), historical development (colonial legacies), and differing social structures (slave vs. free labor). Despite these differences, both economies were interconnected through trade and depended on each other for certain goods.