How were the economies of the northern and southern states different how are they the same what factors led them to develop differently?

The northern soil and climate favored smaller farmsteads rather than large plantations. Industry flourished, fueled by more abundant natural resources than in the South, and many large cities were established (New York was the largest city with more than 800,000 inhabitants). By 1860, one quarter of all Northerners lived in urban areas. Between 1800 and 1860, the percentage of laborers working in agricultural pursuits dropped drastically from 70% to only 40%. 

The fertile soil and warm climate of the South made it ideal for large-scale farms and crops like tobacco and cotton. Because agriculture was so profitable few Southerners saw a need for industrial development. Eighty percent of the labor force worked on the farm. Although two-thirds of Southerners owned no slaves at all, by 1860 the South's "peculiar institution" was inextricably tied to the region's economy and culture.

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