For economic historians, the period between 1815 and 1914(for the sake of brevity “the 19th century”), is defined above all by the consequences of the first Industrial Revolution. This ultimately led to more and more countries enjoying rising living standards, even as population grew at unprecedented rates. The process of industrialization was uneven, however. It began in Britain, and quickly spread to Northwest Europe and North America. By the end of the 19th century there were clear signs of modern industrialization in countries all around the world. But the delayed diffusion of modern industry meant that an enormous gap in living standards opened up: a “Great Divergence” that is only now being slowly unwound.

This Great Divergence implied that the world became increasingly asymmetric, divided between an industrializing “core” and an as yet non-industrial(or even de-industrializing) “periphery”. This opened up the possibility of large-scale trade, with the core exchanging manufactured goods for the food and raw materials produced by the periphery. Since the core and the periphery were located in different continents, trans-oceanic trade would necessarily be at the heart of such a development, which required lower trade costs. And trade costs did eventually fall, massively, as a result of two consequences of the Industrial Revolution.