CHAPTER IV. 

 Internal Trade and the Transportation System. 



In the absence of a non-agricultural population centered in manu- 

 facturing towns and cities, the internal trade of a country must 

 perforce be limited to the exchange of goods between the agricultural 

 regions in the back-country and the commercial towns, if there be 

 any, on the seacoast or on navigable rivers. The inland farmers 

 will endeavor to secure in this way as great a quantity as possible 

 of the commodities which they either could not produce at all, or 

 only at too great an expense. The amount of this trade will depend 

 chiefly on the demand for the farmers' products from the outside, 

 upon the amount which will be taken at a price high enough to pay 

 the costs of production and of transportation. A second determining 

 condition is the state of the transportation system. This, however, 

 is of only secondary importance; for with the most perfect and the 

 cheapest means of transportation, there will be no trade unless there 

 is somewhere a population desirous and capable of making purchases. 

 On the other hand, if there is a steady demand for goods, strenuous 

 efforts will soon be made to improve and cheapen the carrying system. 

 Such improvements, of course, come tardily; it may be from lack of 

 capital available for investment or from a failure to realize the bene- 

 fits of such improvements; and there is always the limitation imposed 

 by the state of mechanical and technical progress, as, for instance, 

 in the centuries before the invention of the locomotive. Once 

 established, it is true, a cheaper method of transportation promotes 

 an extension of the geographical division of labor, and so stimulates 

 and increases trade. But nevertheless, it is the market which is of 

 primary importance as regards internal trade; for unless there is a 

 purchasing population, either actual or potential, at one end of a 

 route, expensive improvements of that route will never be attempted. 



One of the best indications of the volume of internal trade of this 

 sort is the size of the commercial towns. In the sea and river ports 

 there will be a non-agricultural population of merchants and ship- 

 owners roughly proportional to the amount of trade carried on by 

 them between the back-country and foreign parts. Boston was the 



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