Economic history of the United States
The 325-mile Erie Canal, which connected Albany, New York, on the Hudson River with Buffalo, New York, on Lake Erie, began operation in 1825. Wagon cost from Buffalo to New York City in 1817 was 19.2 cents per ton-mile. By Erie Canal c. 1857 to 1860 the cost was 0.81 cents. The Erie Canal was a great commercial success and had a large regional economic impact.
Erie Canal
The Erie Canal was an immediate success. Tolls collected on freight had already exceeded the state's construction debt in its first year of official operation. By 1828, import duties collected at the New York Customs House supported federal government operations and provided funds for all the expenses in Washington except the interest on the national debt. Additionally, New York State's initial loan for the original canal had been paid by 1837. Although it had been envisioned as primarily a commercial channel for freight boats, passengers also traveled on the canal's packet boats. In 1825 more than 40,000 passengers took advantage of the convenience and beauty of canal travel. The canal's steady flow of tourists, businessmen and settlers lent it to uses never imagined by its initial sponsors. Evangelical preachers made their circuits of the upstate region, and the canal served as the last leg of the Underground Railroad ferrying runaway slaves to Buffalo near the Canada–US border. Aspiring merchants found that tourists were reliable customers. Vendors moved from boat to boat peddling items such as books, watches and fruit, while less scrupulous "confidence men" sold remedies for foot corns or passed off counterfeit bills. Tourists were carried along the "northern tour," which ultimately led to the popular honeymoon destination Niagara Falls, just north of Buffalo.