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World Economy In 19thCentury
The world changed profoundly in 19th century. Economic, political, social and cultural factors interacted in complex ways to transform societies. Economists identify three types of movements of flows within international economic exchanges. The first is the flow of trade that in the 19th century referred largely to trade in goods. The second is the flow of labor- the migration of people in search of employment. The third is the movement of capital for short term or long-term investment over long distances. All three flows were closely interwoven and affected people’s lives more than ever before. The interconnections could sometimes be broken for example labour migration was often more restricted than goods or capital flows.
Population growth from the late 18th century had increased the demand for food grains in Britain. As urban centers expanded and industry grew the demand for agricultural products went up pushing up food grain prices. Under pressure from landed groups, the government also restricted the import of corn. The laws allowing the government to do this were commonly known as the Corn Laws. Unhappy with high food prices, industrialists and urban dwellers forced the abolition of Corn Laws.
After the Corn Laws were scrapped food could be imported into Britain more cheaply than it could be produced within the country. British agriculture was unable to compete with imports. Vast areas of land were now left uncultivated and thousands of men and women were thrown out of work. From the mid -19th century faster industrial growth in Britain also led to higher incomes and therefore more food imports. Railways were needed to link the agricultural regions to the ports. New harbors had to be built and old ones expanded to ship the new cargoes. All this required capital and labor. Capital flowed from financial centers such as London. The demand for labor in places where labor was in short supply as in America and Australia led to more migration.
Nearly 50 million people emigrated from Europe to America and Australia in the 19th century. All over the world some 150 million are estimated to have left their homes, crossed oceans and vast distances over land in search of a better future.
Technology played a very important role in shaping the world in 19th century. Till the 1870s animals were shipped live from America to Europe and then slaughtered when they arrived there. But live animals took up lot of ship space. Many also died in voyage, fell ill or became unfit to eat. Meat was hence an expensive luxury beyond the reach of the European poor. High prices in turn kept demand and production down until the development of new technology like refrigerated ships that enabled the transport of perishable foods over long distances. Now animals were slaughtered for food at the starting point in America, Australia or New Zealand and then transported to Europe as frozen meat. This reduced shipping costs and lowered meat prices in Europe. The poor in Europe could now consume more varied diet. Better living conditions promoted social peace within the country and support for imperialism abroad.