It is widely believed that assembly-line mass production, quality-control procedures, inventory accounting, and multi-tiered factory management structures are inventions of the modern world, offspring of the mechanization and industrialization whichswept through Western Europe and America during the eighteenth and nineteenth centuries. But two thousand years ago in China, during the Han period (206 BC-AD 220), advanced production and management techniques were already implemented in well developed forms in the extensive factory system operated by the Han imperial government. This study was written as Part One of a larger project on workshops and artisans in Ancient China. Part Two was published as the book, Artisans in Early Imperial China (UW Press, 2007).