“Portage: Path dependence and increasing returns in U.S. history” by Jeffery LIN
Economics Seminar
Authors:
Jeffery LIN
Federal Reserve Bank of PhiladelphiaHoyt Bleakley
University of Chicago
We examine portage sites in the U.S. South, Mid-Atlantic, and Midwest, including those on the fall line, a geomorphologic feature in the southeastern U.S. marking the final rapids on rivers before the ocean. Historically, waterborne transport of goods required portage around the falls at these points, while some falls provided water power during early industrialization. These factors attracted commerce and manufacturing. Although these original advantages have long since been made obsolete, we document the continuing-and even increasing-importance of these portage sites over time. We interpret this finding in a model with path dependence arising from local increasing returns to scale.
