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.
Canal
In the United States, navigable canals reached into isolated areas and brought them in touch with the world beyond. By 1825 the Erie Canal, long with 36 locks, opened up a connection from the populated Northeast to the Great Lakes. Settlers flooded into regions serviced by such canals, since access to markets was available. The Erie Canal (as well as other canals) was instrumental in lowering the differences in commodity prices between these various markets across America. The canals caused price convergence between different regions because of their reduction in transportation costs, which allowed Americans to ship and buy goods from farther distances much cheaper. Ohio built many miles of canal, Indiana had working canals for a few decades, and the Illinois and Michigan Canal connected the Great Lakes to the Mississippi River system until replaced by a channelized river waterway.
Three major canals with very different purposes were built in what is now Canada. The first Welland Canal, which opened in 1829 between Lake Ontario and Lake Erie, bypassing Niagara Falls and the Lachine Canal (1825), which allowed ships to skirt the nearly impassable rapids on the St. Lawrence River at Montreal, were built for commerce. The Rideau Canal, completed in 1832, connects Ottawa on the Ottawa River to Kingston, Ontario on Lake Ontario. The Rideau Canal was built as a result of the War of 1812 to provide military transportation between the British colonies of Upper Canada and Lower Canada as an alternative to part of the St. Lawrence River, which was susceptible to blockade by the United States.
In France, a steady linking of all the river systems – Rhine, Rhône, Saône and Seine – and the North Sea was boosted in 1879 by the establishment of the Freycinet gauge, which specified the minimum size of locks. Canal traffic doubled in the first decades of the 20th century.