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Shaping of the World Economy

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Shaping of the World Economy - Lesson Summary

The World trade expanded in the 19 th century. There were technological, social, economic and political changes which shaped the world economy.

During this time, three flows governed international economic exchanges. These were the flow of trade or movement of goods, the flow of labour and the movement of capital. In the late 18 th century due an increase in population in Britain, the demand for food grains increased considerably.

Rapid industrialisation in urban centres also contributed to the increase in the prices of food grains.
The British government imposed Corn Laws which restricted the import of corn into Britain. After the outcry of the people against high prices the government abolished these laws. Thereafter, Britain witnessed a deluge of cheap imported food which had adverse impacts on the agriculture sector of Britain.

People hence migrated to cities and other countries in search of jobs and a better life. In Russia, Australia and America, new means of transport like railways and harbours were developed to boost trade. New and settlements were built and accommodate emigrant labourers.

In the nineteenth century, world economy was in a phase of rapid growth and transformation. Technological innovations also helped in the expansion of trade. In New Zealand, America and Australia refrigerated ships were used to carry perishable items such as meat to Britain.


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