Impact of the Transport Revolution on Global Trade

The Transport Revolution

Increasing agricultural and industrial production made no sense if it was not possible to deliver goods to the population. A series of innovations revolutionized transportation and allowed for increased trade.

The Railroad and the Steamboat

Since the mid-eighteenth century, in Britain and much of Europe, there was an improvement in traditional communication routes (roads, river navigation, etc.). In the beginning, the railroad was used in mines to transport ore in wagons moving on rails. The first innovations included a new system of iron rails and flanged wheels to prevent derailment. However, the truly innovative phenomenon was Stephenson's locomotive (1829), which powered the railway with a steam engine. The first passenger line joined the cities of Manchester and Liverpool (1830).

In the following decades, the construction of the railway network in Europe was a great stimulus to the development of the iron and steel industry. The railway shortened the length of journeys, increased travel safety, and, given its higher capacity, lowered the cost of transporting goods. Subsequently, the steam engine was applied to shipping, and steamboats, built with iron, replaced sailing ships. The first steamers began operating in the U.S. around 1807, and by 1847, ships could cross the Atlantic Ocean in 15 days.

Increased Trade and Market Expansion

The Industrial Revolution gave way to a market economy, where goods were produced not for subsistence but for sale in increasingly larger markets. This change was made possible thanks to increased production, population growth, and the improved purchasing power of peasants and the working classes. Likewise, improved transportation systems allowed for increased domestic trade. Thus, local markets expanded and gradually began to consolidate into a national market.

Foreign trade also increased considerably in the mid-19th century. Theories of free trade argued that open commerce between countries would promote healthy economic growth; however, to defend against British supremacy, many states beginning their industrialization imposed protectionism—the defense of national industry through taxes (tariffs) on imports.

Industrial Capitalism

The Industrial Revolution originated an economic model of capitalism, supported by liberalism as a political doctrine. From Britain, this new system spread to the rest of Europe, the USA, and Japan.