2.

             For all intents and purposes, manufacturing in America was not practical. Heilbroner has noted several factors that were hindering the development of manufacturing in America. America's expansive size created a couple of problems. There was no cost-effective way of transporting manufactured goods from their origin to the other far away regions of the country. .

             Also, with so much land available, a concentrated population of willing industrial laborers failed to exist. People were more apt to tame a piece of the available wilderness to farm for themselves than to toil in someone else's mill. Of equal importance was the lack of a technological foundation - one that could produce complex machinery with a large variety of complicated parts. An effective means of transportation would be the first step in overcoming these problems. Railroads and canals would provide a solution. 3.

             The Erie canal ,which was completed in 1825, had a profound impact on the economy of the northern region. Heilbroner notes that, as a result of the canal, the cost of transporting freights to New York from the west was reduced by 90%. He states that the cost of shipping one ton of cargo from Buffalo to New York was 20 cents a mile in 1817. By the mid-1850s, after the completion of the Erie canal, the cost fell to less than one cent a ton-mile. This caused the volume of goods entering the economy to increase drastically. In 1836, about 58,000 tons moved along the Erie canal. By 1860, the number of tons increased to 1.8 million.4 The Erie canal significantly reduced the cost of moving goods and raw materials, and it had other effects on the economy as well.

             The Erie canal encouraged the planning of other canal projects. Heilbroner claims that at least one hundred major canal projects were planned within a year of the completion of the Eerie canal. The cumulative cost of canal building in the 1820s and 30s was $125 million; a significant portion of that came from foreign investors.