Applied Micro - Dan Bogart (UC Irvine)

Applied Microeconomics Seminar Series

Title: Transport, market access, and urban growth in the first industrial revolution

Abstract: Cities are engines of growth. England and Wales in its early industrial phase is an ideal historical setting to study how small towns might grow to be industrial hubs and how transport improvements affect urban transitions. We show that a 'pre-steam transport revolution, primarily driven by canals built between 1760 and 1830, lowered trade costs dramatically. Moreover, lower trade costs led to more market access,  which increased urban populations, particularly in the industrial towns away from London. Greater market access also had knock-on effects on incomes and occupational structure. The effects of pre-steam transport improvements had persistent effect into the late 1800s when the steam transport revolution began to have greater effects.