The Transport Factor of Formation of the Era of Modern Economic Growth

Abstract

The article deals with the transport factor influence on the implementation of the Industrial Revolution and the transition from the “Malthusian” economy to modern economic growth. Attention is focused on the periods of economic history of the early Roman Empire and medieval China. It is noted that the level of socioeconomic development of the Roman Empire at the beginning of our era was close to that of Western Europe shortly before the Industrial Revolution. The conclusion is drawn that the Roman Empire fell into a “transport-institutional trap” which blocked the movement along the path of industrialization and economic growth. In medieval China, the level of socio-economic development corresponding to the threshold of the Industrial Revolution was also reached. At the same time, many transport restrictions were removed. In particular, deep-sea trade became possible, allowing the establishment of global economic ties. Nevertheless, its development was blocked by the state policy of isolationism, which led to the decline of the Chinese economy. In Western Europe, the accumulation of innovations in shipbuilding and navigation in transnational competition led to the beginning of ocean navigation in the 15th century, new lands pioneering and the development of intercontinental goods exchange. The resulting geographically diversified economy stimulated technological progress and supply of goods, and gave a powerful impact to the development of the institutions of capitalism. To ensure dynamic economic growth in the 21st century, it is necessary to remove the newly emerging transport restrictions through economic policies that stimulate entrepreneurial activity in the transport sector.