What term describes the early industrial labor system in which workers produced goods at home?

• A. Factory system
• B. Domestic system
• C. Guild system
• D. Cottage industry

Answer: (B)

This describes the domestic system, a way of organizing work where merchants put out raw materials to households and workers produce the finished goods at home. Families, often using their own tools and spaces, completed tasks like spinning, weaving, or sewing and then returned the completed items to the merchant. This setup sits between rural craft before factories and the later factory-based system, because production is dispersed across many homes rather than centralized under one roof.

It’s distinct from the factory system, which centralizes work in large plants with machines; and from the guild system, which centers on urban workshops controlled by craft guilds and formal training. The cottage industry term is closely related and often used interchangeably, but the domestic system emphasizes the merchant-driven, home-based network of production described here.