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New Port Cities In Western America And Their Effect On Economic Development

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New Port Cities In Western America And Their Effect On Economic Development

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Content This dissertation has been 65-6907
microfilmed exactly as received
HAMMELTON, Raynal Leigh, 1931-
NEW PORT CITIES IN WESTERN AMERICA
AND THEIR EFFECT ON ECONOMIC DEVELOP
MENT.
University of Southern California, Ph. D. , 1964
Economics, history
University Microfilms, Inc., Ann Arbor, Michigan

NEW PORT CITIES IV WESTERN AMERICA AND THEIR
EFFECT ON ECONOMIC DEVELOPMENT
by
Raynal ^eigh Hammelton
A Dissertation Presented to the
FACULTY OF THE GRADUATE SCHOOL
UNIVERSITY OF SOUTHERN CALIFORNIA
In Partial ;'ulfillment of the
Requirements for the Degree
DOCTOR OF PHILOSOPHY
(Economics)
August, 1964
UNIVERSITY O F S O U T H E R N C A L IFO R N IA
T H E G R A D U A T E S C H O O L
U N I V E R S I T Y P A R K
L O S A N G E L E S C A L I F O R N I A 9 0 0 0 7
77m d i s s c r t n h o n f "t K itten by
..... RAYNAL LEIGH. HAMMELTON....
under the direction of hi.& .Dissertation C o m
mittee, a n d a p p r o v e d by nil its members, has
been presented to and accepted by the (j raduate
School, in partial f it! fill meat of requirements
for the deqree of
D O C T O R O F P H I L O S O P H Y
• < - r- ■
** bran
Pule
DISSERTATION CO M M ITTEE
TABLE OF CONTENTS
CHAPTER PAGE
I. INTRODUCTION ................................... 1
Statement of the Problem .................... 1
Importance of the problem .................. 1
Objectives of the study.................... 2
Scope of investigation.................... 4
Available Literature on the problem ......... 5
Published material ........................ 5
Review of past research.................... 6
Organization of the Dissertation ........... 6
Methodology................................. 6
Organization of the remainder of the
dissertation ............................. 7
II. TRANSPORTATION AND ECONOMIC DEVELOPMENT: SOME
RELATED POINTS OF IMPORTANCE ............... 9
The Economic Functions of Transportation . . 9
The division of labor.........................10
Expansion of the market...................... 11
Economies of s c a l e ...........................12
Stabilization of prices and competition . . 14
Security......................................14
ii
iii
CHAPTER
External economies ...................... 15
Transportation, a productive activity . . 15
The Importance of Transportation as Illus
trated by Three Periods in History ... 16
Poor transport methods of medieval times,
a hindrance to trade...................... 16
Improved nineteenth century transport
means opened New Frontiers................20
Canals....................................20
Railroads................................. 24
The Steel S h i p ...........................30
The Modern Era, the benefactor of the
transport revolution ............... 32
The Neglect of Adequate Transport Litera
ture in both the History of Doctrine and
Economic Development Fields ............. 34
The classical tradition ............... 34
Developmentalists of the nineteenth
century................................. 37
Alexander Hamilton ................. 37
Albert Gallatin ...................... 39
Friedrich L i s t ........................ 41
iv
CHAPTER PAGE
The Economic development literature . . 44
The Balanced versus the Unbalanced
Approach to Economic Development .... 47
The balanced capital investment approach
to economic development ................. 47
The unbalanced capital investment
approach to economic development . . . 51
The sequence of growth, predetermined by
history....................................53
III. TRANSPORTATION, THE DISTRIBUTION OF POPULA
TION, AND ECONOMIC DEVELOPMENT ............ 59
The Theoretical Approach to the Growth of
Cities and Its Relation to Transportation 59
Cooley......................................59
MacKinder....................................65
Hawtrey......................................66
Weber........................................ 67
Palander....................................73
Loesch...................................... 74
Chamberlin..................................76
Conclusion..................................78
V
CHAPTER PAGE
The Historical Growth of Cities and Its
Relationship to the Growth of Transporta
tion ........................................78
From transhipment point to city........... 78
The ancient world.........................78
Europe....................................81
The Transport Revolution, effect on
population in England ................. 87
Historical instances of Transport's
dynamic role in Early America........... 96
The determination of transshipment
points in Colonial America ......... 96
The successful Erie Canal, a builder
of cities in New York State.......... 104
The growth of selected inland trans
shipment points........................109
IV. THE HISTORICAL ROLE OF THE SEAPORT, THE DIS
TRIBUTION OF POPULATION, SOME COMPARISONS . 119
Introduction ............................... 119
Characteristics of San Francisco's Initial
Period of Growth 1850-1880 120
Economic Factors ........................ 120
vi
CHAPTER PAGE
Population Changes ...................... 127
Changing totals ........................ 128
Migration..................................128
Foreign-born migrants .................. 133
Sex composition.......................... 137
Age composition.......................... 138
Conclusion............................... 140
Characteristics of Los Angeles' Period of
Growth 1880-1910 141
Economic factors ........................ 141
Population changes ........... ..... 148
Changing totals ........................ 148
Migration..................................150
Sex composition.......................... 152
Age composition.......................... 154
Concluding Remarks ........................ 155
V. AN EVALUATION OF THE SEAPORT AS GENERATOR AND
PROGENITOR OF ECONOMIC DEVELOPMENT AND
SPECIALIZATION ............................. 159
The Economic Base Theory as a Method of
Urban Analysis............................ 159
The development of base theory .... 159
vii
CHAPTER PAGE
The base ratios......................... 162
Limitations of the economic base theory . 167
Other methods of metropolitan economic
analysis................................. 177
Economic Functions Associated with a Port . 178
Definition of a P o r t ...................178
Port service functions, one of the acti
vities within the economic base .... 182
Maintenance of harbor facilities . . . 182
Services rendered to shipping ......... 183
Services in cargo handling ........... 186
Harbor department personnel ........... 187
The Industrial Port...........................188
Ship building and ship repair, an exclu
sive port activity...................... 188
The transshipment factor, an agglomera-
tive influence upon industry..............191
Petroleum refining .................... 191
Steel plants............................. 193
Power plants and smelters................193
Miscellaneous .......................... 194
viii
CHAPTER PAGE
Port industries, their gravitational
attraction on other basic industries . 195
Entrepot activities, an Important Source
of Income for Large Port Cities............197
From the Port's Economic Base, Service
Activities May Be Estimated.................201
VI. SACRAMENTO, A CASE STUDY OF A NEW PORT, AND
ITS PROSPECTIVE CONTRIBUTION TO THE LOCAL
AND NATIONAL ECONOMY ...................... 205
The Early City, a City that Grew from River
Port Activity............................... 205
Efforts to Establish a Deep-water Port . . 208
Sacramento's Industry, Population, and
Market Potential in the 1960's ......... 214
Industry....................................214
Transportation .......................... 218
Utilities....................................221
Industrial Parks ........................ 223
Military Establishments .................. 225
Locational decisions .................... 225
Population..................................233
Markets......................................234
ix
CHAPTER PAGE
The Sacramento-Yolo Deep-Water Port, a New
Element in the Economic B a s e ...........236
Introduction ............................ 236
Services rendered to shipping, cargo
handling, and port personnel........... 239
Present Cargoes moving out of the Port . 240
Prospective sources of cargo ........... 242
The Potential Industrial Generating Power
of the Port.............................. 242
Present industrial status of the port . . 242
What specific industries can be expected
to locate near the port? 251
VII. STOCKTON, AN ESTABLISHED PORT IN CALIFORNIA'S
INLAND EMPIRE .............................. 255
An Historical Overview of the City of
Stockton.................................255
Present-day Industry, Population, and
Market-Potential of Stockton ........... 257
Industry.................................257
Transportation .......................... 259
Utilities.................................260
Growth...................................2 61
X
CHAPTER PAGE
Industrial Parks.........................261
Military Establishments .................. 263
Sharpe Army Depot.................... 263
Stockton Naval Annex .................. 263
Pacific Reserve Fleet--Stockton Group . 263
U. S. Naval Communication Station,
San Francisco...................... 263
Locational decisions .................... 263
Population.............................264
Markets................................. 266
The Port of Stockton as a Transshipment
Center................................. 267
The Port's development .................. 267
The Port of Stockton in the 1960's . . . 274
Services rendered to shipping, port
personnel, and cargo handling .... 274
Cargoes that pass through the port . . 278
Outbound cargoes .................... 278
Inbound cargoes ...................... 283
The Failure of Stockton's Port to Create
Industrialization ........................ 286
Present industrial status of the port . . 286
xi
CHAPTER PAGE
Why the port failed to generate an
industrial milieu ...................... 289
The Future............................. 294
VIII. CONCLUSIONS.................................... 297
Can a Comparison Be Drawn Between the
Present Study and Other Port Cities? . . 297
New Port Cities and Their Effect on
Economic Development .................... 301
A powerful influence .................... 301
Criticisms leveled at Sacramento's Port . 306
Will Sacramento or Stockton's Port lead
to a future metropolitan district
similar to America's largest cities?. . 310
Can the present underdeveloped countries
learn a lesson from this study?.......314
Final Conclusions.........................321
Economic development must proceed via
excess capacity in transport ......... 321
Many theories may have elements of truth
in them.................................326
BIBLIOGRAPHY ........................................ 331
xii
PAGE
APPENDIXES
A. The Physical Characteristics of the Port of
Sacramento....................................345
B. The Physical Characteristics of the Port of
Stockton......................................348
C. Steamship Companies and Agents Whose Vessels
Use the Port of Stockton either Regularly
or Occasionally............................... 349
LIST OF TABLES
TABLE PAGE
1. The Degree of Population Concentration in
England During the Nineteenth Century . . . 90
2. Percentage of Population in Cities of Eng
land and Wales During the Nineteenth
Century...................................... 91
3. The Growth Rate of English Cities for the
Decade 1821-1831 92
4. The Growth Rates of Various Classes of
English Cities ............................. 95
5. Cities with High Export Employment............171
6. Cities with High City-Serving Employment . . 173
7. Relative Specialization of Industries by
Major Classification as Indicated by
Location Quotients, Sacramento County,
1953-1959 ................................... 217
8. Sacramento Employment in the Five Largest
Manufacturing Firms, 1963 .................. 219
9. Principal Sacramento Nonmanufacturing
Employment, 1963 219
xiv
TABLE PAGE
10. Sacramento Employment within Specific
Categories....................................220
11. Factors Influencing Industrial Locational
Decisions, Percentage of Surveyed
Sacramento Firms .......................... 227
12. Factors Influencing the Locational Decisions
of Large Sacramento Firms .................. 230
13. The Leading Stockton Employers, 1963 .... 258
14. Major Categories of Employment Within
Stockton................................... 258
15. Population Growth, San Joaquin County,
1910-1960 ................................... 265
16. Population Growth, City of Stockton,
1910-1962 ................................... 265
17. Cargo Tonnage Moved and Ocean Vessel Calls,
Port of Stockton, 1933-1945 ................ 269
18. Cargo Tonnage Moved and Ocean Vessel Calls,
Port of Stockton, 1948-1962 ................ 272
19. The Principal Geographical Trades for the
Port of Stockton, 1962 273
20. The Principal Geographical Trades for the
Port of Stockton, 1936. 273
XV
TABLE PAGE
21. Record Breaking Cargo Movements for a Ten-
Day Period, Fall of 1963, Port of Stockton 282
22. Distances from the Sea of Some Important
World Ports....................................308
CHAPTER I
INTRODUCTION
I. STATEMENT OF THE PROBLEM
During Che last two decades economic development
has gained a new interest within the field of economics.
When economics was dominated by the classical and neo
classical systems of thought, little attention was given to
economic development per se. It was assumed that natural
economic forces, forces centered in the market mechanism,
would create a developmental pattern. However, realizing
that the market mechanism operates only fitfully, econo
mists directed their attention to discovering ways to
create a more rapid rate of growth in the poor nations of
the world. The result has been the creation of various
economic theories and economic models to explain growth.
Many of these theories are brilliant insights into economic
phenomena. However, much remains to be done in this field.
Importance of The Problem
Presently, the world is faced with a rapidly
2
expanding population. However, coupled with this expansion
is a resource base that is not being properly utilized with
the existing technology. At present, there are rival
political and economic systems contending for the loyalty
of the world's masses. Accepting the assumption that it is
necessary for the world at large to accept the general
political and economic philosophy of the western world,
economists have devised plans for creating economic develop
ment . These plans have as their intent not only an
increased income per capita but also the acquisition of
the loyalty of the world's poor nations.
Theoretical economic developmental thinking is
connected to planning programs by economic development
planners, who base many of their decisions upon economic
development theory. Therefore, good theory is essential
to good planning. If the theoretical concepts of economic
development are sound, economic development will have a
better chance of keeping ahead of the population boom.
The study conducted here is an attempt to add a new phase
to the economic development literature now extant.
Obi ectives of The Study
This study focuses attention on one aspect of
3
economics that has been neglected within the field of
economic development. It is transportation. Transporta
tion performs many functions. For instance, it determines
the extent of the market. The extent of the market
establishes to what degree the division of labor will be
carried. Geographical division of labor which gives rise
to regional and international trade often renders possible
an increasing scale of production. External economies,
which a large city such as New York produces, can only
come about through heavy concentration of economic activity.
Large cities are dependent on the adequacy of their exter
nal transportation system. Moreover, new techniques of
transport are likely to lead to an increase of urban
population.
A study of the growth of the port city and its
effect on economic development has been bypassed. Yet one
of a nation’s important natural resources is its harbors
and natural waterways. Man has improved these resources
and has produced a transportation system tailored to his
needs. Before the advent of the railroad, water trans
portation was the only practical way to transport bulky
commodities. Access to water transportation was essential
to the great cities of the world. Cities might exist as
4
either religious or political centers, but commercial
importance has been dependent on transport facilities
which meant water communication.
As a result of transportation being neglected in
regard to economic development, the transshipment points
within the transport network have been neglected also. It
is the purpose of this study to explore the role of the
transshipment point and its growth upon economic develop
ment. Very specifically, the study attempts to project
the possible influence that the new seaport at Sacramento
will have upon the economic development of Sacramento.
Stockton is also a relatively recent seaport. The effect
of its seaport on its economic development will be reviewed
as well.
Scope of Investigation
The study is conducted along the lines of an
historical, comparative approach to city development. In
tracing the development of transshipment points into cities,
each specific epoch in the advancement of transportation
and its effect on various transshipment points is studied.
Geographically, there is no limitation on the scope of this
study. However, the study does narrow its geographical
5
horizons to port cities on the west coast of the United
States. Furthermore, the scope of the study is limited to
a qualitative approach to the problem rather than a
quantitative one.
II. AVAILABLE LITERATURE ON THE PROBLEM
Published Material
There is no published material related directly
to this topic. Books on the economics of transportation
have ignored not only the role of the transshipment point,
but they have neglected the interaction of transportation
and economic development as well. The same may be said
in regard to books on economic history; the problem is
ignored.
The economic development literature is better.
Yet it gives an inadequate treatment to the transport
function.
The literature on location theory also fails to
give an analysis of transportation and economic development
or transshipment points and economic development. Port
cities are scarcely mentioned.
Does port literature exist? The answer is yes.
However, what port literature there is exists in the
6
nature of public relations literature that has been
issued by individual ports.
Review of Past Research
Extensive search has brought to light no study that
covers transportation and its role in economic development.
Nothing has been found on the evolution of the trans
shipment point and economic development. Nor has anything
come to light on the role of the seaport and economic
development. These topics have been bypassed by all those
concerned with economic development.
III. ORGANIZATION OF THE DISSERTATION
Methodology
There are four cumulative steps in economic
research: (1) exploration of the problem, (2) development
of a hypothesis, (3) empirical testing of the hypothesis,
and (4) evaluation and conclusion. Logical consistency
requires sound research procedure to follow the above
enumerated steps in their numerical order.
In this dissertation, Step 1, exploration of the
problem, involves a review of the literature on transporta
tion and economic development. This review of the
literature is strengthened by a survey of the importance
of transportation during different historical periods.
Step 2, development of an hypothesis, the hypothesis in
this study is that: economic development will proceed
most rapidly via excess capacity in the transportation
sector of the economy. Furthermore, economic development
will proceed most rapidly if the transshipment points in
the transport network are given special attention.
Step 3, empirical testing of the hypothesis in this study
involves historical comparisons between transportation,
the distribution of population, and economic development.
Step 4, evaluation and conclusions, in this study embodie
the conclusion that the limited developmental funds which
are available can be best utilized if spent on the trans
port system in general and the transshipment points in
particular.
Organization of the Remainder of the Dissertation
The dissertation is organized into eight chapters
Chapter II is devoted to exploring the problem. It exam
ines the theoretical and historical relationship between
transportation and economic development. Chapters III
and IV contain a comparative study of the growth of
different entrepots.
In Chapter V the study is narrowed to one particular
type of a transshipment point as a generator of economic
development, namely the seaport.
A case study is undertaken of two new port cities
in western America in Chapters VI and VII. Both Sacramento
and Stockton are analyzed. A full consideration is given
to the role of the new port cities in stimulating economic
development. The last chapter, number VIII, consists of
the conclusions that are drawn from the study.
CHAPTER II
TRANSPORTATION AND ECONOMIC DEVELOPMENT: SOME
RELATED POINTS OF IMPORTANCE
I. THE ECONOMIC FUNCTIONS OF TRANSPORTATION
Before the advent of the most primitive means of
transportation, man's economic life involved little
division of labor. Gregariousness and the need for pro
tection were the primary factors in the formation of
tribal organizations and villages. Man was dispersed
widely over the earth's surface. It was necessary for him
to live near the food producing areas, or as in the case
of the American plain's Indians, to follow the buffalo
herds. The carrying of food from a distance to a town
awaited not only improved agricultural techniques but
transportation as well.
The development of transport did not necessarily
have to mean the introduction of either mechanical devices
or domesticated animals. Rather man's use of the concept
of moving goods, from areas of high supply to areas of low
9
10
supply coupled with high demand, was the milestone whereby
transportation began to affect man's economic and social
destiny. The best example of a transport system, under
taken without the aid of animals or mechanical means, is
the system of porters used by the ancient Mexicans. During
the Aztec era as many as fifty or sixty of these porters
would band together in order to carry goods to some point
within the Aztec empire.^
The Division of Labor
Transportation by furnishing place and time
utility allowed man to become more permanently settled
into towns. Transportation stimulates the development of
the division of labor. According to Adam Smith, an
increase in productivity due to the division of labor
results from three causes, which are as follows: an
increase in the dexterity of workmen, a saving of time,
and an increase in invention. As well as human occupations,
the division of labor also applies to geographical special
ization. Regions may concentrate on products best suited
for production, and exchange the surplus with other
^Charles H. Cooley, The Theory of Transportation,
(Publications of The American Economic Association, Vol. 9,
No. 3, May 1894), p. 25.
11
regions. However, the ability to exchange rests upon the
state of transportation. Its development determines to
what extent the division of labor may be carried.
Expansion of The Market
Another function transportation performs is to
expand the market. As transportation improves, the market
expands by cheapening the goods which are traded. Moreover,
improvement in transportation allows goods previously not
exchanged to enter commerce. An expansion of the market
does not necessarily mean a more extensive market. An
extensive market means a market over a wide geographical
area. For example, the opening of the Liverpool and
Manchester steam railroad in 1830 certainly expanded the
market for many goods in western England. However, this
did not necessarily mean a more extensive market for an
English export such as woolens. One writer underrates
transportation's role in economic activity by assuming that
because trade was carried on over an extensive area in
ancient times, transportation is relegated to a minor role
economically speaking. Usher states, "Some have disposed
to believe that difficulties of transportation prevented
the sale of goods over large areas until a fairly recent
12
n
period, but this is a serious error."*6 His contention is
that social inequalities limited the market. He does
differentiate a vertical from an horizontal expansion of
the market. The truth of the matter is that transportation
and its improvements have affected economic activity by
cheapening goods, allowing a vertical expansion of the
market. In other words, more economic classes can
participate in a world-wide or nation-wide economy.
Economies of Scale
Closely related to the expansion of the market
resulting from transportation, are the increasing returns
from economies of scale. This function transportation
can introduce. However, it is relatively new. In ancient
times, nevertheless, the size of the market would determine
how intensively salt beds would be worked. Yet economies
of scale introduced at this stage of economic development
were evidently small. However, the modern era with its
mass production techniques has benefited from economies of
scale through the use of large-scale industrial plants.
^Abbott P. Usher, The Industrial History of England
(Cambridge, Mass.: The Riverside Press, 1920), p. 20.
13
A small market for a product forces the adoption of a
small plant because of insufficient demand regardless of
the technological possibilities of a larger plant. A
relatively large market means that a choice may be made
in the size of the plant. A large factory rendering
great economies of scale, or in other words that plant
which operates at the lowest point on the long-run average
cost curve, becomes an economic possibility with the
availability of a large market.
In addition to the size of the market being depend
ent on the means of transportation, improved transport
allows a more efficient management of enterprises. For
example, the various functions of a manufacturing enter
prise may be more effectively split into its components.
The manufacturing activity can be located in an area which
will utilize the cheapest production function. The office
activities may be located in a central business district.
The era of concentrating all of a firm's activities on
one premise is long past in economically advanced nations.
However, the placing of productive components in different
areas is dependent on effective transportation and
communication.
14
Stabilization of Prices and Competition
Competition and the stabilization of prices will
be brought to a higher degree of attainment by improved
transportation. Allowing distant competitors to enter a
home market heightens competition and in turn benefits
the consumer. Prices will tend to be stabilized due to a
greater number of suppliers. If one of these should fail,
due to natural calamities or poor business judgment,
market prices will not be as adversely affected as would
be the case with only a few firms.
Security
As transportation improves, there will be greater
security for both goods and passengers. Fear of pirates
and highwaymen made transportation precarious in many
periods and acted as a barrier between not only nations
but cities within the same country. Disasters at sea in
earlier periods, which meant a loss of goods, were
reflected in high insurance rates. However, risk coverage
is not a recent development. During medieval times
traders within the Hanseatic League used it. Even before
medieval times Italian merchants provided insurance on a
15
mutual basis.^ High insurance rates mean added expense
for transportation. The advent of the railroad and the
steamship meant greatly improved security for goods in
transit. With this occurrence the insurance expense
declined.
External Economies
Transportation has provided another function, the
creation of external economies. These economies are
created by factors outside of the firm which enable it to
offer its product at a lower supply price. These economies
are often associated with the multi-economic phases of
large cities. Many new firms find these economies essen
tial in order to provide a start. The improvements in
transport have given all firms increased external economies.
The development of transportation has enabled cities to
grow by cheapening the mass of commodities that flow to
them.
Transportation, A Productive Activity
The above transport functions refute an argument
^Isaac Lippincott, The Development of Modern World
Trade (New York: D. Appleton-Century Company, 1936),
p. 471.
16
which is often made, to the effect that transportation is
wasteful. Transportation allows production to be carried
out under more efficient conditions. Attempting to decen
tralize industry in order to eliminate transport costs
might eliminate these charges, but at the expense of other
added production costs. Striving for self-sufficiency on a
national or local scale is a similar case. The result of
either would be a higher cost to the consumer. The tend
ency to separate the costs of factory production from
transport costs is common. However, as early as 1844 a
Frenchman, M. Dupuit, recognized the significance of trans
port costs. He said, "The ultimate purpose of a means of
transportation ought not to be to reduce the costs of
transportation, but to reduce the costs of production,"^
II. THE IMPORTANCE OF TRANSPORTATION AS ILLUSTRATED
BY THREE PERIODS IN HISTORY
Poor Transport Methods of Medieval Times, A Hindrance to
Trade
The lack of commerce during the medieval period,
. Philip Locklin, Economics of Transportation
(Chicago: Business Publications, Inc., 1938), p. 18 citing
M. Dupuit, "De la measure de l'utilitie des travaux
publics," Annales des onts et Chaussees, 2nd series, v. 8,
(1844), p. 351-352.
17
which resulted from the low productivity of the era in
both production and in transportation, produced almost
self-sufficient villages. Famines would arise in one
region whereas there would be comparative abundance in
another. Such a situation is associated today with China.
However, this was common in Europe during the middle ages.
One authority states,
A bad harvest meant serious suffering, because
there was no opportunity to buy food supplies outside
the manor and bring them to it. Nearly every year
was marked by a famine in one part or another of a
country, and famine was often followed by pestilence."^
Another feature of medieval life, which is indica
tive of the poor means of transport, is the phenomenon of
the fairs. These fairs were held at stated intervals, in
which it was possible to purchase or to exchange goods.
Instead of having a continuous flow of goods into centers
of distribution, as in the modern era, goods were collected
by the merchants and displayed for sale at certain towns
and at certain seasons. This was also a period in which
merchant ships traveled in convoy for protection against
pirates. The periodic nature of trade at this time is what
^Leon Carroll Marshall, Readings in Industrial
Society (Chicago: The University of Chicago Press, 1918),
p. 124.
18
is significant. All trade both on land and on sea was
dependent on the state of the weather.
It was not until a later period that the problem
of inadequate transportation, as an impediment to trade,
was recognized. During the medieval period, economic
thought had concentrated on problems of usury and the just
price. In 1767, Henry Homer wrote, An Enquiry into the
Means of Preserving Publick Roads. He attributed England's
backward condition during the reign of Queen Anne (1702-
1714) upon the difficulties of internal communication.
He says,
The trade of the kingdom languished under these
impediments. Few people cared to encounter the
difficulties, which attended the conveyance of goods
from the places where they were manufactured, to the
markets, where they were to be disposed of. And
those, who undertook this business, were only enabled
to carry it on in the wintry season on horseback, or,
if in carriages, by winding deviations from the
regular tracks, which the open country afforded them
an opportunity of making. . . . The natural produce
of the country was with difficulty circulated to
supply the necessities of those counties and trading
towns, which wanted, and to dispose of the super
fluity of others which abounded. Except in a few
summer months, it was an almost impracticable attempt
to carry very considerable quantities of it to remote
places. Hence the consumption of the growth of grain
as well as of the inexhaustible stores of fuel, which
nature has lavished upon particular parts of our
island, was limited to the neighbourhood of those
places which produced them; and made them, comparatively
speaking, of little value to what they would have been,
19
f i
had the participation of them been enlarged.
Edwin A. Pratt, in A History of Inland Transport and
Communication in England, reports Daniel Defoe's comments
on roads:
Defoe tells how the transport of timber from the
neighbourhood of Lewes to Chatham by road sometimes
took two or three years to effect. He saw there
twenty-two oxen engaged in dragging "a carriage
known as a tug" on which the trunk of a tree had
been loaded; but the oxen would take it only a short
distance, and it would then be thrown down again and
left for other teams to take it still further short
distances in succession.^
Though the United States was settled after the
middle ages, many of the transport problems which plagued
that era were later to plague the Americans. The sea
served as the best means of commerce among the colonies.
However, the lack of communication with the west became
the biggest problem. The Appalachian Mountains formed an
obstacle to effective trade. The development of the Ohio
Valley was retarded because of this obstacle. Private
capital was inadequate for the task of either road or canal
^Edwin A. Pratt, A History of Inland Transport and
Communication in England (London: Kegan Paul, Trench,
Trubner and Company, Ltd., 1912), p. 73-74, citing Henry
Homer, An Enquiry into the Means of Preserving Public Roads
?Ibid., p. 68.
20
building as a means of conquering this range of mountains.®
Improved Nineteenth Century Transport Means Opened New
Frontiers
It is a mistake to assume that all efforts toward
improved transport facilities bore fruit in the nineteenth
century. Improvement had been going on for centuries.
Nevertheless, certain developments did take place in this
age which along with the industrial revolution changed
man's economic and social life.
Canals. Before the introduction of steam power,
the carriage of goods over land was in need of great
improvement. In England, Telford and MacAdam succeeded in
improving the English roads during the last quarter of the
eighteenth century. However, the movement of bulky com
modities such as grains, coal, and ores needed a more
efficient means of transfer. The answer to this problem
came with the canal. Canal building goes back to the
ancient Egyptians. The first Suez Canal dates from 1900
B.C. Several lakes were connected in order to form this
Q
T. W. Van Metre, Transportation in The United
States (Brooklyn, N.Y.: The Foundation Press, Inc., 1950),
p. 19.
21
9
early canal. Other ancient peoples have records of canal
building as well.
During the later middle ages there were canals in
Europe. One successful canal was the ship canal connecting
Lubeck with Hamburg. In France the Atlantic and Mediter
ranean were linked by the famous Langue-doc Canal (Canal du
Midi). It was inspired by the mercantilist, Colbert, while
he was Louis XIV1s principal minister. This early canal,
constructed in 1681, was 148 miles long, pierced a mountain,
and contained 119 locks. During the Napoleonic era, canal
building increased in France. Many of these canals became
connecting links between the large river systems. The same
was true in Germany. Improvements in her many natural
waterways, along with connecting canals, eventually gave
Germany an excellent inland waterway system. England saw
the passage of a canal act in 1759. Because of the miser
able road conditions in that country, canal building was
undertaken with enthusiasm. By 1830 there were 3,000 miles
of canals and canalized rivers.^
^Harry E. Barnes, An Economic History of The Western
World, (New York: Harcourt, Brace, and Co., 1937), p. 20.
l^Ibid., pp. 331-2.
22
Canals provided the means of moving bulky commod
ities. Would an iron or steel industry have been possible
without such a development? Fortunately for England; iron
ore and coal deposits are located close together. In fact,
the Scotch iron industry was partly based, states Bowden,
"On the famous blackband ironstone, an ore consisting of
alternate layers of coal and iron. When a hot blast was
used, the iron could be smelted with the fuel mined with
the ore."^ Moreover, England, being an island, has the
advantage of nearness to ocean transportation.
On the continent things were different. For
example, France's position was not as fortunate. Her
deposits of iron ore and coal are separated. Not until
12
after 1825 were her iron resources developed. Germany
was blest with large iron ore and coal fields. However,
these were not situated as favorably as those in England.
One authority states that high transport costs was one
factor in hindering the development of an iron industry in
^Hfitt Bowden, Michael Karpovich, and Abbott P.
Usher, An Economic History of Europe Since 1750 (New York:
American Book Company, 1937), p. 456.
12
Frederic A. Ogg, Economic Development of Modern
Europe (New York: The Macmillan Company, 1917), p. 216.
23
13
Germany before the mid-nineteenth century.
In the era before the railroad, canal building
dominated the thoughts of industrialists and economists.
The advantages of canals were widely publicized. The
enthusiasts for canals brought about more projects than
the true demand for them warranted. This was true in
England. Here private initiative was the stimulus in con
trast to governmental control, as in continental Europe.
In England, the eventual oversupply of canals even led to
a number of business failures.^
In the United States the success of the Erie Canal,
completed in 1825, brought on a mania for canal building.
Nevertheless, some attention had been given earlier to the
problem of canal building. For instance, in 1697 the
General Court of Massachusetts appointed a commission to
study the feasibility of constructing a canal across Cape
Cod.^ Despite this interest, the Cape Cod Canal, which
13Ibid., p. 217.
l^Barnes, oj>. cit. , p. 332.
* - 3B. H. Meyer, History of Transpor tat ion in The
United States Before 1860 (Washington, D. C.: Carnegie
Institution of Washington Pub. No. 215c reprinted by
Peter Simple, 1948), p. 159.
24
enabled ships to bypass the treacherous cape, was not
completed until after the Civil War. Of the many canals
built in the United States during the pre-railroad era,
none came to equal the fame or success of the Erie Canal.
Despite the failure of many canals, the successful ones
changed the economic geography of North America.
Railroads. That industrialization waited upon the
means for transporting bulky commodities economically is a
truism. However, with the industrial revolution came new
and improved methods of transportation. No sooner had these
new canals become thriving enterprises than a new mode of
transport, the railroad, was introduced. This was a direct
product of the new industrialism. The invention of the
steam engine and the development of the iron industry were
both necessary precursors of the railroads. Again the
significance of the railroads upon economic development,
as with the canals, arises from the fact that it is a means
whereby materials with a low value per unit of weight can
be transported cheaply. Grains, coal, and iron ore were
the significant goods of the nineteenth century to fall
within this category.
The railroads were especially significant to those
countries which span continental land masses, the two most
25
notable ones being the United States and the Union of
Soviet Socialist Republics. In Russia the rivers do not
give convenient access to other European countries or to
industrial regions. The development of railroads during
the last half of the nineteenth century set the stage for
the rapid industrial progress characteristic of the last
decade of that century. Railroad mileage in Russia rose
from 700 miles in I860, to 21,000 miles in 1894. By 1900
it had reached 36,000 miles.^
In the United States a similar situation existed.
Sections of the country required a radical transportation
development in order to insure development. The Appala
chian Mountains had presented an obstacle to westward
expansion, an obstacle which canals could not effectively
overcome. In another area, the trans-Mississippi region,
the rivers were too shallow to permit freight transporta
tion. The solution to these problems came with the
railroad. Its importance advanced steadily. There were
approximately 30,000 miles of railroad in 1860, 53,000 miles
in 1870, 93,000 miles in 1880, and 167,000 miles by 1890.17
^Bowden, Karpovich, and Usher, oj>. cit. , p. 606.
17
Charles M. Thompson, Economic Development of The
United States (New York: The Macmillan Co.,1939), p. 277.
26
The iron and steel industry was dependent on the
railroad. Of course, technical developments, such as the
Bessemer process, are not to be disparaged. Fortunately,
for the newly developing U. S., iron ore and coal deposits
were in close proximity. Nevertheless, some transport was
required to bring the raw materials to the mill, not to
mention the shipment of the finished product. Moreover,
accelerated American railroad construction created a demand
for iron which not only American but European companies
as well supplied.
In the settlement of the west, the tide of immi
grants came after the railroads, not before. The railroads
became agents and propagandists for colonization and
industrial growth. One notable example was Los Angeles;
here the Southern Pacific Railroad actively promoted
growth. Furthermore, the competition between this company
and the Santa Fe Railroad drove rates down to rock bottom
level. The Southern Railroad Company sent agents, not only
to the East to sign up prospective western immigrants, but
to Europe as well to find new colonists to settle the west^
l®Carey McWilliams, Southern California Country
(New York: Duell, Sloan, and Pearce, 1946), pp. 125-126.
27
The survivival of the railroads depended upon traffic,
consequently much zeal was expended in publicity upon the
West.
The effect of the railroads upon port cities was
profound. A well conceived railroad system could determine
the future of a port city. An interesting case of the
importance of the railroad is the rivalry between the ports
of New York, Boston, Baltimore, and Philadelphia during
the nineteenth century.
New York had become America's first port before the
completion of the Erie Canal. Nevertheless, the other
three ports struggled to gain supremacy. Boston was the
most vigorous contender. She ranked second to New York in
19
registered tonnage and second in shipbuilding. In 1856
and 1859 Boston surpassed New York in the total tonnage
20
of new vessels constructed. In several areas of foreign
commerce, Boston held its leadership as the number one port
in the nation until the end of the rivalry.^
^Robert g . Albion, The Rise of New York Port (New
York: Charles Scribner's Sons, 1939), p” 389, Appendix I.
20Ibid. p. 375.
2IIbid.
28
With the completion of the Erie Canal, New York
gained access to a western hinterland which the other ports
did not possess. The other ports now realized some action
must be taken to safeguard their position. Boston and
Baltimore placed their hopes on railroads to the West.
Philadelphia, unfortunately, secured a link to Pittsburgh
on the Ohio by means of a motley combination of railroads
and canals called the "Main Line." Despite great expense,
the enterprise was never successful. Consequently,
Philadelphia became the least important of the four ports.
Boston gave the most vigorous response. News of
railroad developments in England had fired Bostonians to
make plans for a Massachusetts rail system. One of the
objectives was a rail link to the Hudson River in New York,
the link which was to enable Boston to tap New York's
western hinterland. This road, the Western Railroad, was
an extension of the Boston and Worcester. The goal was an
all rail line between Boston and Albany, N. Y. By 1841
this goal was reached. Because of the railroad, business
in Boston underwent a boom during the 1840's. Moreover,
the early establishment of the Cunard Line in Boston
provided regular connections between the American west and
Europe. Yet, according to one authority, "By the fifties,
29
Boston's brief spurt had run out and from every quarter
came evidence of her failure to obtain earlier ambitions."^
Nevertheless, the completion of the Western Rail
road by Massachusetts worried New York. Being overconfi
dent with its canal, it had neglected railroads. One New
York source in 1842 lamented,
Five years ago a prediction that flour would be
transported from Albany to Boston at fifty cents
per barrel, would have been deemed an idle phantasy,
yet the dream of the visionary has been realized;
and we now find an eastern city (Boston) competing
successfully with us for the commerce of that grand
canal, which we have been accustomed to regard as
exclusively our own."23
The result was the entrance of New York into the
railroad race. Rail connection between New York and
Albany was achieved in 1851 by the Hudson River Railroad.
This meant a tie not only with the Erie Canal but also with
short railroads running parallel to the canal. The most
well-known of these was the Mohawk and Hudson Railroad.
9 9
"^Edward C. Kirkland, Men, Cities, and Transporta
tion ; A Study in New England History (Cambridge, Massachu
setts: Harvard University Press, 1948), p. 148.
23ibid., p. 224.
30
That same year, 1831, New York secured a rail link to Lake
Erie via New York's southern counties. This link, the
Erie Railroad, gave New York excellent transport facilities
to the Great Lakes, facilities which eventually gave it
access to Chicago. Thus New York's importance was not
impaired by Boston or Baltimore.
Baltimore, the second rival of New York, also
placed her hopes on a railroad endeavor. Baltimore grew
and prospered because its leaders saw the importance of
rail transport at an early era. Fortunately, she did not
copy Philadelphia's "Main Line" nor get involved with a
canal project on the eve of rail supremacy. The Baltimore
and Ohio Railroad, begun in 1828, was finally completed to
the Ohio River in 1853. In regard to the E. and 0., one
authority states,
The Baltimore and Ohio is a conspicuous instance
of a railroad planned and built as a means of extend
ing the market of an important urban community. The
road is conceived of as the Baltimore road, with but
one aim beyond paying its way, namely, to serve the
interest of the city whence it c a m e . 24
The Steel Ship. Water transportation represented
another area of vast improvement. The introduction of the
steamboat upon the inland waters of the United States
^^Meyer, op. cit., p. 412.
31
enhanced commercial connections among the various sections.
Their use was widespread, from the Hudson River in New York
to California in the west. Among them, the Mississippi
steamboats became the most famous. The ocean-going steam
ship brought better service also. In 1838 two steamships
reached New York from Liverpool, inaugurating regular
trans-Atlantic steamship service. The steamship gave a
more regular service. Moreover, it could make more trips
per year which meant greater cargo carrying capacity.
Improvements in the steam engine, though often not spectac
ular, brought greater efficiency, notably in the use of
coal. In 1840 Cunard's fleet which consisted of four
steamships was required to use forty per cent of its
carrying capacity for fuel.^5 1830, nine pounds of
coal per horsepower hour were consumed. Thereafter it
steadily dropped to 5.3 pounds, to 4 pounds, to 3 pounds
each successive decade. By 1870 it dropped to 2.3 pounds
2 ft
per horsepower hour. D
The advent of the steel or iron ship was of prime
^^Bowden, Karpovich, and Usher, op. cit. , p. 399.
^Ibid. , p . 400.
32
importance. It was a necessary step. There is a limit to
the size of a wooden vessel, because the stem and stern
27
posts must be a single piece. Beyond a length of 300 feet,
wood fails to produce the necessary stability.2® One
author summarizes, "The experience that iron ships were
stronger, of greater capacity, and could be built upon
hitherto unthought of dimensions, sealed the doom of the
29
wooden ship."
The possibility of iron ship construction awaited
the malleable iron period. Cast iron was impractical. The
introduction of malleable iron came very propitiously, at
a time when larger ships were needed because of the
increased scale of trade, and timber for ship building was
becoming scarce, notably in England.
The Modern Era, The Benefactor of The Transport Revolution
Land transportation was most affected by the
transport revolution. The railroad was the most important
element. As one writer says, "Before the introduction of
27Ibid., p. 402.
28
Adam W. Kirkaldy and Alfred D. Evans, The History
and Economics of Transport (London: Sir Isaac Pitman and
Sons, Ltd., 1927), p. 299.
2^Ibid.
the steam railroads there were few products of the soil
which could bear the cost of carriage by land for a
distance of more than a hundred and fifty miles.
New modes of transport enabled the growth of great
inland urban centers. Speaking specifically of the rail
road, Van Metre says,
In overcoming distance it made it possible for
the population of the world to move inland from
navigable waters, and it opened to development and
exploitation the resources of field, mine, and
forest in the interior regions of the continental
masses of the earth's surface.31
The growth of the world market has come into
reality. Instead of trade being confined to high value
products exclusively, products of low value have entered
the picture. Goods can now be hauled about the earth on
a substantial scale. The emergence of this world economy
32
has been dated at 1870.
30
Van Metre, Op. cit. , p. 3.
31Ibid.
32
Charles P. Kindleberger, Economic Development
(New York: The McGraw-Hill Book Company, Inc., 1958),
p. 98.
34
III. THE NEGLECT OF ADEQUATE TRANSPORT LITERATURE
IN BOTH THE HISTORY OF DOCTRINE AND ECONOMIC
DEVELOPMENT FIELDS
The Classical Tradition
The first great classical economist, Adam Smith,
discusses the role of transport in his book, The Wealth of
Nations. Despite the length of this work, he covers this
topic in four pages, and it is discussed under the heading
of "A limitation of The Division of Labor on The Extent of
The Market." Smith speaks of industry expanding along
water routes, because water transport creates a more
extensive market. China and Egypt both developed upon
river systems, he says. Later civilization grew and
prospered about the Mediterranean coastal regions. He
does not seem to regard transportation as a factor of
production. Rather he looks upon it as a factor either
limiting or encouraging trade. Smith's contribution to
economic thought came before the significant advances in
transport technique. In considering this, his attitude
is understandable.
Smith set the trend for the Classical and Neo-
Classical tradition. He did not give transportation an
35
important role. His concern was in refuting the Physio
crats and the Mercantilists. In a sense, his battle was
an ideological one. Furthermore, the battleground within
economics has been over the division of the product, con
sequently distribution and its problems have always played
a predominant role within the field.
Later writers in the socialist tradition became
engrossed with the factory system, private ownership of
property, and distribution. Marx followed the same
pattern. One economic historian in summarizing the
Marxian view states,
The famous Communist Manifesto was not merely an
economic interpretation of history, but in strict
analysis an "industrial" interpretation of history.
All the stress was laid upon class differentiation
and the relation of the development of the
capitalist modes of p r o d u c t i o n .33
The great changes in the structure of the transport
system were rarely discussed. This was coupled with a
complete lack of interest in location theory by the English,
American, and French economists. Some of the German econo
mists notably Von Thunen developed theories of location.
Nevertheless, the great effects, brought about by the
changes in the structure of transport, were only alluded to.
^Bowden, Karpovich, and Usher, 0j>. cit. . p. 403.
36
The zenith of the Central or Classical tradition
in economics was the work of the great Neo-Classicist
Alfred Marshall. His voluminous, Principles of Economics
covers a wide range of economic theory and activities. In
Book IV, Chapter 10 of his Principles. he discusses, "The
Concentration of Specialized Industries in Particular
Localities." In this ten page chapter, improvements in
transport are introduced toward the end. Here he discusses
it under the heading of "Improvement in the Means of
Communication." In this section he does not discuss the
hypothesis that the transport revolution brought
widespread changes.
In Book VI, Chapter 12 of his Principles. Marshall
again brings up improvements of transport; but it is done
in a rather curious indirect manner. After discussing a
number of influences upon economic progress, Marshall intro
duces the important point. This he does in the middle of
a paragraph beginning with a discussion of, "England's
inability to gain a larger amount of raw produce because
she has shared her improvements of manufacture with other
nations." However, he produces a profound statement on
transportation in the middle of his paragraph. It is,
37
Probably more than three-fourths of the whole
benefit she (England) has derived from the progress
of manufactures during the nineteenth century has
been through Its Indirect Influences In lowering the
cost of transport of men and goods, of water and light,
of electricity and news: for the dominant economic
fact of our own age Is the development not of the
manufacturing, but of the transport i n d u s t r i e s . ^
The question might be asked, why did not Marshall
build a chapter in his work upon such a statement? It
would appear, the answer lies with a neglect of the problems
of location and also of transport, which was so very
typical of the economists of the nineteenth century.
Developmental1sts of The Nineteenth Century
Alexander Hamilton. Although Hamilton was active
before the nineteenth century, he is included here because
he believed in and fought for the industrial development
of the United States. His campaign for a protective tariff
is well-known. He felt that through the advance of manu
facturing the United States could gain self-sufficiency,
thereby combating many of the restrictive policies of
British trade. As one may recall, free trade for England
did not come until the 1830's. In order to encourage
34
Alfred Marshall, Principles of Economics (New
York: The Macmillan Company, 8th ed., 1948), pp. 674-5.
38
development Hamilton founded an organization for this
purpose, the Pennsylvania Society for the Promotion of
Manufactures and Mechanical Arts. On December 3, 1791,
while Secretary of the Treasury, Hamilton sent a "Report
on Manufactures" to the House of Representatives. His
introduction to this report states:
The Secretary of the Treasury . . . has applied
his attention, ... to the subject of manufactures,
and particularly to the means of promoting such as
will tend to render the United States independent of
foreign nations for military and other essential
supplies; . . .33
In regard to transportation, Hamilton approaches the
problem from the standpoint of its relationship to manu
facturing. He attributes England's superior manufacturing
position to this cause. He states,
There is, perhaps, scarcely anything which has
been better calculated to assist the manufacturers of
Great Britain than the melioration of the public
roads of that kingdom, and the great progress which
has been of late made in opening canals. Of the
former, the United States stands much in need; for
the later, they present uncommon facilities.36
Furthermore, Hamilton's interest goes beyond a few
roads or local canals. He writes,
35
Henry Cabot Lodge (ed.), The Works of Alexander
Hamilton. Vol. 4, (New York: G.P. Putnam's Sons,1904),p.70.
36Ibid., p. 159.
39
There can certainly be no object (improvement of
inland transport) more worthy of the cares of the
local administrations; and it were to be wished
that there was no doubt of the power of the National
Government to lend its direct aid on a comprehensive
plan. This is one of those improvements which could
be prosecuted with more efficacy by the whole than
by any part or parts of the Union.37
Despite Hamilton's comments, he presents no
concrete proposals for improvements in transport facilities
in his report on manufactures. He devotes five short
paragraphs to transportation. To other articles of com
merce such as iron, grain, and cotton he gives more
attention. Undoubtedly, he failed to foresee the westward
expansion to the Mississippi River which was about to begin.
Albert Gallatin. Gallatin was deeply involved in
the political life of the early United States. As Presi
dent Jefferson's Secretary of the Treasury, problems came
before him that were of concern to the new nation. The
best example of the above is a resolution passed by the
Senate, to direct the Secretary of the Treasury to prepare
a report on worthwhile projects for internal improvement.
The demand had been growing in many quarters of the nation
for better inland transportation.
■^Ibid.
40
The famous report of 1808 was an admirable summary
of the various schemes which were before the attention of
38
the public. Gallatin, though not the originator of these
projects, enumerated them in one comprehensive report. The
report embraced four areas of improvement where government
aid was sought. These were:
1. Great canals along the Atlantic seacoast,
uniting New England with the South.
II. Communication between the Atlantic and the
western waters.
III. Communication between the Atlantic, St. Lawrence
and the Great Lakes.
IV. Interior canals and roads.^9
Numerous canal projects were listed under each
general heading. Gallatin estimated that the proposals for
improvement of internal navigation could be made with
$20,000,000. He further believed that with an estimated
yearly surplus of $2,000,000 the projects could be
completed in ten years.4®
3®Meyer, op. cit., p. 135.
39Ibid.
40Ibid.. p. 136.
41
The above report illustrates that, even though
economic theoreticians did not place a heavy stress on
transport problems, governments were ever conscious of
the problem.
Friedrich List. Another nineteenth century
developmentalist, List was,in contrast to the above men,
an economic theorist. His principle work, National System
of Political Economy, is one of the milestones of economic
doctrine. In addition to writing he actively engaged in
politics and various developmental schemes. In a few
places in his National System he discusses the importance
of transportation and economic development. In commenting
upon England's industrial might he says, "England has
shown the world how powerful is the effect of facilities
of transport in increasing the powers of production, and
thereby increasing the wealth of population, and the
political power of a nation.Of course, List does not
attribute England's industrial might to this alone. He
does enumerate other factors. Later he states his own
concept of the relationship between transportation and
manufacturing. He says,
^Friedrich List, The National System of Political
Economy (London: Longmans, Green, and Co., 1904), p. 40.
42
The power of machinery, combined with the perfec
tion of transport facilities in modem times, affords
to the manufacturing State an immense superiority over
the mere agricultural State. It is evident that
canals, railways, and steam navigation are called into
existence only by means of the manufacturing power,
and can only by means of it be extended over the
whole surface of the country. In the mere agricultural
State, where everybody produces for himself the
greater part of what he requires, and consumes himself
the greater part of what he produces, where the
individuals among themselves can only carry on a small
amount of goods and passenger traffic, it is impossible
that a sufficiently large traffic in either goods or
passengers can take place to defray the costs of the
erection and maintenance of the machinery of transport.
In discussing the increased value of land upon the
growth of manufacturing, he states,
These are the very same causes and effects which we
may perceive in respect to improved means of transport;
which not merely yield in themselves a revenue, and
through it a return for the capital spent upon them,
but also powerfully promote the development of
manufactures and agriculture, whereby they increase
in the course of time the value of the landed property
within their districts to tenfold the value of the
actual material capital which has been employed in
creating them. The agriculturist, in comparison with
the undertaker of such works (improved means of
transport), has the great advantage of being quite
sure of his tenfold gain on his invested capital and
of obtaining this profit without making any sacri
fices, while the contractor for the works must stake
his whole capital. The position of the agriculturist
is equally favourable as compared with that of the
erector of new manufactories,43
42Ibid., p. 162-3.
43Ibid., p. 194.
43
One of List's accomplishments was to lay out a plan
for a railway system in Germany. He published a pamphlet
in 1833 entitled, "Thoughts on a Railway System for Saxony,
as the Foundation of a System for the Whole of Germany, and
in Particular on the Building of a Line from Leipsic to
Dresden.1,44 Included in this pamphlet, is a map in which
List lays down a possible future rail system for Germany.
He entitled the map, "The German Railway System." One
authority states, "The accompanying map is a noteworthy
achievement of scientific imagination, for in it List's
prophetic hand outlined practically the whole of the present
German railway system."4^ His German rail system is,
". . . all traced at a time when even England could only
show a few isolated railways. And, it was largely owing to
List's untiring work that before two decades went by the
prophecy became an accomplished fact."4^
List was an individual, who actively promoted
economic development for his country. He is noteworthy in
that he was an economist of high repute. His activities
44Margaret E. Hirst, Life of Friedrich List (London:
Smith, Elder and Company, 1909), p. 75.
ibid., p. 76.
46Ibid.
44
went beyond an explanation of the workings of the economic
system, which was the interest of most nineteenth century
economists.
The Economic Development Literature
Since the end of the Second World War, interest has
centered on the problems related to the development of a
national economy. The emphasis has been upon the nation
state, because of the deeply national feelings of nations
emerging from the war, and the strong national feelings of
the new countries. The cosmopolitan, laissez-faire
attitude of the nineteenth century had lost its appeal.
The problems of economic development have come to
dominate the thoughts of many economists. Transport
facilities now come under the heading of "Social Overhead
Capital." Within the realm of Social Overhead Capital,
emphasis has often been placed upon other factors besides
transport.
As stated before, not enough attention has been
paid to the transport factor. For example, excellent texts
on economic development have not given sufficient attention
to this problem. The first one, Charles Kendleberger1s
Economic Development, places a three page discussion of
45
transport under the heading of the "Growth of Markets."
Though inadequate in scope, the three page discussion is
excellent. The concept of transport linkage is developed.
He says, "It is not surprising that economic development
is correlated positively with transport facilities."47 ne
gives an example of the effect of military roads built in
Turkey under the Truman Doctrine. In speaking of examples
of development coupled with transport improvements, he
concludes, "Too little attention is generally paid in these
accounts to the spread of communication needed to link
markets."^8 Despite his comments, the effect of the
transport revolution is covered in but two pages of his
book.
Within his concluding chapter he covers transport
in two sentences. In the first one, he says, "Transport
links markets as well as people. As such it increases
elasticities, improves the efficiency of the price system,
and permits the achievements of economies of scale in
production and d i s t r ibu tion. "^ He gives to transport,
^Charles P* Kindleberger, Economic Development
(New York: The McGraw-Hill Book Company, Inc., 1958),p. 96.
48Ibid., p. 98.
49lbid.. p. 313.
46
including communication) an investment priority outranking
all else except education.
Another outstanding work is Meir and Baldwin's
Economic Development. Despite an extensive listing of
transportation topics in the index, there is no adequate
coverage of transportation and its role to economic
development. It is alluded to often but fails to command
even a minor heading.
Another important work in the literature describes
adequately transport's relationship to economic development.
It is Norman S. Buchanan's and Howard S. Ellis's Approaches
to Economic Development. There is a special section within
a chapter on the functions of transportation. Moreover,
the effect of the transport revolution is covered. One
pertinent comment made is,
At the time these improvements in transport and com
munication were being introduced, few people realized
how drastically they would change the economic
organization of production.^
The conclusion,
the authors state,
■^Norman S. Buchanan and Howard S. Ellis,
Approaches to Economic Development (New York: The Twenti
eth Century Fund, 1955), p. 137.
47
seems inescapable that improved transport played an
enormous role in the rise in productivity and real
incomes during the nineteenth century, although this
role was less direct and obvious than the effects of
some of the great inventions of Watt or Arkwright now
so familiar to every schoolboy.51
Other than the standard texts, two outstanding
works on the theory of economic development are decidedly
deficient in giving adequate coverage to this factor. The
first one, W. Arthur Lewis's The Theory of Economic Growth,
does no more than acknowledge transportation's vital role.
The second work, Albert Hirschman's The Strategy of Econom
ic Development.would prefer to give investment priority to
other areas besides transport.
The journal, Economic Development and Cultural
Change. has yet to produce an article on transportation
per se or one on transportation's relation to either
economic development or to cultural change.
IV. THE BALANCED VERSUS THE UNBALANCED APPROACH TO
ECONOMIC DEVELOPMENT
The Balanced Capital Investment Approach to Economic
Development
This approach, balanced capital investment, has
48
been widely held by developmental1st8. In essence, it
means that new investment should be made over a wide range
of ventures. These include manufactures for both exporta
tion and the home market. Included in the last are port
development, railroads, education, public health,--yes,
and even luxury goods. Development in agriculture would
be paced evenly with manufacturing development. One pro
ponent for this doctrine is W. Arthur Lewis. In his The
Theory of Economic Growth he well expresses this position.
He writes that the various sectors in the economy must
grow in the right relationship to each other, or they will
52
not grow at all.
A balance must be achieved between agriculture and
manufactures. If one sector pulls ahead of the other one,
the sector which lags will be unable to absorb the sur
pluses of the more advanced sector. Lewis says, "Innova
tion in one sector of the economy is checked unless other
sectors expand appropriately."33 Lewis cites the example
of the U.S.S.R. Here, because a disproportionately large
52*. Arthur Lewis, The Theory of Economic Growth
(Homewood, 111.: Richard D. Irwin, Inc., 1955), p. 276.
53Ibid., p. 277.
49
investment was placed in manufacturing, agriculture
suffered. The result was an inflation of agricultural
prices which in turn acted to drive all prices upward.
According to Lewis, not only should a balance be
maintained between manufacturing and agriculture, but a
balance must be maintained between three sectors; agricul
ture, production for export, both agricultural and manu
facturing, and manufactures for home consumption. If one
sector expands more rapidly than the other two sectors, its
growth will be held back by the lagging sectors. Also, if
one sector should lag too far behind the others, it will
act as a drag on the other sectors. The only exception to
this would be a rapid expansion of the export industries.
In this case an excess of exports can be used for additional
imports. If the economy does not need imports at present,
foreign exchange reserves can be accumulated in order to
be spent in the future. Lewis concludes, "The truth is
that all sectors should expand simultaneously."54
Another authority, Ragnar Nurkse, has also expressed
firm belief in the balanced approach to new investment. In
discussing the problem of the "vicious circle of poverty,"
he asks the question, "What is it that breaks the deadlock?"
54Ibid., p. 283.
50
His answer is, "An over-all enlargement: of the m a r k e t . " ^
Capital must be applied to a wide range of industries.
He says, "Most industries catering for mass consumption
are complementary in the sense that they provide a market
for, and thus support, each other. This basic comple
mentarity stems, in the last analysis, from the diversity
of human want s.
Nurkse bases his concept on Schumpeterian writings.
According to Schumpeter the economic development of the
western world proceeded as waves of industrial activity.
The crest of the business cycle represents the forward
moving wave, whereas the trough of the business cycle
represents a period of rest. The trough is a period of
recuperation, where the forces of industrial growth gather
momentum for the next big push. As Schumpeter expresses
it, these waves result "Each time . . . in an avalanche of
consumers' goods that permanently deepens and widens the
stream of real income although in the first instance they
-^Ragnar Nurkse, Problems of Capital Formation in
Underdeveloped Countries (Oxford, England: Basil Blackwell,
1953), p. 11.
56Ibid.
51
spell disturbance, losses, and unemployment."57
Taking this Idea, Nurkse believes In what has been
termed in developmental literature as "the big push."
However, he does not use this term. He says that If
capital can be applied over a wide range of industries,
then the income generated will create a market for the
products of these industries. An enlarged market is
provided. This he considers to be of prime importance.
He states,
A wave of capital investments in a number of different
industries can economically succeed while any sub
stantial application of capital by an individual
entrepreneur in any particular industry may be blocked
or discouraged by the limitations of the preexisting
market.5®
The Unbalanced Capital Investment Approach To Economic
Development
In contrast to the balanced approach, a new theory
now challenges it, which is the unbalanced approach. This
thesis has been put forward by Albert Hirschman in his
work, The Strategy of Economic Development.
S7
■^Joseph A. Schumpeter, Capitalism, Socialism, and
Democracy, 3rd ed.; (New York: Harper and Brothers Pub.,
1950), p. 68.
^®Nurkse, o£. cit.. p. 13.
52
It is Hirschman's contention that the balanced
growth theories arose from the economic thinking character
istic of the depressed 1930's. In fact, the growth models
of Harrod and Domar are based on Keynesian analysis.
Hirschman believes that the creation of a theory of economic
development on the assumption that the first criteria must
be the establishment of an enlarged market, is, to begin
with, making an assumption which is unrealistic for an
underdeveloped nation.
According to Hirschman, the trouble with the
balanced growth doctrine is that it requires an abundance
of an ability which poor countries are short of, namely,
entrepreneurial ability. The strategy, Hirschman conceives,
is to start the growth process moving by creating a
disequilibrium situation. If there is disequilibrium, then
decisions will be forced upon society. These induced
decisions will push the society forward. Hirschman terms
such economic decisions as "induced investment." He says,
An ideal situation obtains when one disequilibrium
calls forth a development move which in turn leads
to a similar disequilibrium and so on ad infinitum.
If such a chain of unbalanced growth sequences could
be set up, the economic policy-makers could just watch
the proceedings from the sidelines.^9
5^Albert 0. Hirschman, The Strategy of Economic Dev
elopment (New Haven: Yale University Press, 1958), p.71-72.
53
For Hirschman, the complementary effects of key
projects will call forth the development process. Of
course, there must be a strategy for the selection of the
proper projects. The plan would be to rank projects in
importance according to a benefit-cost ratio. Special
thought would have to be given to their practicable
effects on growth.
Hirschman's main consideration is upon the path of
economic development. The end result is not his primary
concern. In fact, he says in effect, let's get the process
moving. The disequilibriums arising will be beneficial to
the extent they induce further development.
The Sequence of Growth, Predetermined by History
Economic developmentalists have attacked the prob
lems of poor health standards, lack of education, transpor
tation, and electric power very early in a country's
development program. In fact, Hirschman mentions that
there is a great deal of safety in this approach, by stat
ing, "underutilized port installations, highways, and even
power plants do not present nearly the same administrative
and public relations problem as a factory that is idle or
54
suffers losses because of insufficient demand."^0
Hirschman states that investment in social overhead
capital or, in other words, investment in education, trans
port, public health, and electric power, et cetera is safer
than what he terms factory production for the market. He
concludes, "It is diversified investment in the general
growth of the economy rather than in the growth of one
specific activity.
If Hirschman had stopped here, his theory of
unbalanced growth would be very strong. However, there
follows a discussion entitled "Development via shortage and
via excess capacity of SOC," (social overhead capital). In
favor of excess capacity in social overhead capital, he
believes that this invites directly productive or manufac
turing activities to come in. It is essentially a per
missive thing. However, Hirschman does not accept this.
He continues his line of thought by saying, if development
proceeds via a shortage of social overhead capital, a
better sequence for development will ensue. The disequili
brium produced will bring pressures from the other sectors
of the economy for corrective action. Thus new investment
60Ibid., p. 85. 61Ibid.
55
in social overhead activities will be induced. Hirschman
feels that by this method a minimum of the scarce resource,
entrepreneurial talent, can be used. He says,
In situations where motivations are deficient, it
therefore seems safer to rely on development via
shortage than on development via excess capacity.
In other words, if we endow an underdeveloped
country with a first-class highway network, with
extensive hydroelectric and perhaps irrigation
facilities, can we be certain that industrial and
agricultural activity will expand in the wake of these
improvements? Would it not be less risky and more
economical first to make sure of such activity,
even though it may have to be subsidized in view ofr
the absence of adequate transportation and power,
and then let the ensuing pressures determine the
appropriate outlays for SOC and its location?62
Despite the good reasoning, Hirschman's position
is weak because he breaks economic activities into two
categories, directly productive activities and social over
head capital. By doing this he must apply the same general
izations to all economic activities within each category.
This is a mistake. Each activity has a different relative
effect on society. For example, one might cite the differ
ence between health services (public or private) and
transportation. A healthy society is advantageous for
economic growth. Yet a healthy society itself is not going
to stimulate economic growth. In contrast, the existence
62Ibid., p. 93.
of transport services will open the possibilities for
growth. Relatively speaking, transportation is more
important than high health standards in producing economic
development. Growth can take place even if a large segment
of the society is ill-fed and sick, providing other factors
are present.
Certainly it is pointless in this discussion to
argue the merits of transportation versus health standards,
education, or electric power. But Hirschman's theory that
manufacturing or directly productive activities should be
given priority over transportation would be, in the light
of the previous discussions, an incorrect sequence of
investment. Historical evidence would indicate that it is
the opening of a new or greatly improved transport link
which in turn creates economic activity. Examples are
countless. The railroads to the Pacific Coast in the
United States are one obvious example. Another example is
new highways in underdeveloped countries, Turkey being a
specific case.^ Transport facilities are the necessary
prerequisite for modern economic development.
Another important factor Hirschman fails to mention
^Kindleberger, oj>. cit. , p. 97.
57
most transport facilities are immovable, durable facilities,
such as breakwaters, piers, warehouses, highways, railroad
tracks and terminals. The biggest aging factor for the
above items is usage not economic obsolescence. Consider
the case of roads. France possessed good roads compared to
England, before the introduction of the MacAdam technique
for road construction. The explanation for this is that
the Romans had left an extensive, well constructed road
system in France. Later France found it comparatively easy
to maintain this system. England, though at one time a
Roman colony, had not been so generously endowed.
If usage is the factor that wears these facilities
out, then it follows that light usage or lack of usage will
mean little or no wear. Therefore, if these facilities
come into existence before development begins, there is no
need to worry about broken down or worn out equipment once
development has started in earnest.
Hirschman has neglected also the problem of the
cost of constructing transport facilities before major
development begins, and the cost of constructing them after
development has begun. Large outlays of human labor are
needed on construction projects. Before major development,
the cost of labor is very cheap. After development has
58
commenced in a nation, the price of labor will rise. This
has been common of countries undergoing development. The
conclusion is that transport facilities must be improved
at a time when labor is both cheap and abundant, not when
it becomes relatively expensive. Moreover it is typical
for the governments to finance these projects. It would be
preferable for the debt burden assumed by the nation to be
as low as practicable as there is the burden of the
interest payments. Likewise, the possibility of obtaining
future loans should be considered. For the above reasons,
transport projects ought to be undertaken early in the
deve1opment program.
Everything considered, the weight of evidence is
against Hirschman's theory in regard to transportation.
The same thing may be said for the balanced growth theorists
Nevertheless, the balanced growth theories would be
improved by inclusion of the thesis that development must
proceed, with excess capacity created first in the
transportation industries.
CHAPTER III
TRANSPORTATION, THE DISTRIBUTION OF POPULATION, AND
ECONOMIC DEVELOPMENT
I. THE THEORETICAL APPROACH TO THE GROWTH OF CITIES
AND ITS RELATION TO TRANSPORTATION
Finding a theoretical discussion on transportation
and the growth of cities difficult, the topic was ignored
before the 1890's.
Cooley
In 1894 the American Economic Association published
a treatise, The Theory of Transportation, by Charles H.
Cooley. In this treatise Cooley discusses the role of
transportation to city development. He believes that with
out transportation mankind would be distributed uniformly
over the earth's surface. In order to have any industrial
activity, men must be concentrated into "foci of industrial
activity." In regard to transport, he says, "The existence
of the smallest village involves the movement of
59
60
commodities to and from it, the beginnings of social
transportation.''^- He continues, "The aim of transportation
is to set men free in respect to place relations, to make
these relations, more plastic to social needs . .
He believes that all types of industrial activity
are centralizing in their tendency. This is true of agri
culture as well. Efficient agriculture means specializa
tion. Specialized agriculture, in turn, means centers of
collection and distribution.
The transport system, Cooley believes, will take a
complex radial shape. The primary roads converge on
regional centers. These centers in turn are linked to a
central city. Secondary roads link farms and other points
of production to the primary roads. He draws an analogy
between roads, the veins of a leaf and the branches of a
tree.^ in these centers or cities, a population gathers
which creates a division of labor, economies of scale,
et cetera.
^Charles H. Cooley, The Theory of Transportation,
Publications of The American Economic Association, Vol. 9,
No. 3, May 1894, p. 74.
2Ibid., p. 75-76.
■^Ibid. , p. 14 note.
61
Certain well-located cities may find that a small
advantage will insure them economic progress over other
similarly located cities. The establishment of a county
seat at such a town is an example. Other activities are
attracted in turn resulting in economic growth.
Many cities owe their existence to their importance
as political centers, religious centers, or military
fortifications. Nevertheless, the most important reason
for the establishment and growth of urban population centers
is economic forces. Speaking of economic forces, Cooley
theorizes that, "Population and wealth tend to collect
wherever there is a break in transportation.4 His concept
of a "break" is a transfer of goods and the temporary
storage of these goods.
We may add, though Cooley does not, that men,
equipment, and storage facilities are necessary for this
transfer. The maintenance and servicing of the transport
means are also necessary functions. This is the beginning
of the economic base. In turn service activities arise
that cater to the economic group previously oriented to
the site by transportation.
4Ibid., p. 91.
62
The question arises, where do these breaks occur?
The answer is, the junctions of land transportation with
water transportation, the junctions of water transportation
with another type of water transportation. Finally, there
is a change from one form of land transportation to
another.
The most obvious junction is the ocean port. Large
lakes may develop port cities as well. River towns grow
because of the transfer of goods between land transport
and river transport. Cities at the mouths of rivers
develop as junction points between river and ocean trans
portation. Cooley says, "Indeed of cities famous for
their commerce those not situated on the estuary or lower
courses of a navigable river are comparatively few."-*
Where a change of transport is necessary between two types
of land transport, junction points will develop on land
masses.
Cooley uses ideas, developed by Roscher in his
Nationaloekonomik, in regard to the location of cities.
Roscher mentioned the importance of an isthmus, which is
the narrowest point in a stretch of land separating two
5Ibid., p. 95.
63
seas. In this case both sides of the isthmus are likely
to develop cities.^ Roscher also shows that breaks in
land transport occur at the border of a mountain district.
In the foothill area between mountains and plain, cities
will be found. These act as break-in-transport-points
between those vehicles suited to mountain transportation,
and the means of transport over flat plain country.7 Since
the advent of the railroads, this type of transfer is no
longer significant. However, in earlier ages it was
important.
A break-in-transport-point may arise from political
causes. The border between two nations is a case of this.
Presently, this is of less importance because of the
practice of shipping in bond. In an earlier era it was
more important. Cooley says,"Among barbarous nations at
all times and among civilized nations in their early
Q
development, this is a cause of the first importance."
According to Cooley, a mere intersection of lines
^Wilhelm Roscher, Geschichte der National Oekonomik
in Deutschland (Berlin: Verlag R. Oldenbourg, 1874),
Chapter 1, Section 1.
7Ibid.
^Cooley, o£. cit., p. 98.
64
of transportation will not induce city growth. The element
of transfer and storage of goods is lacking. Many rail
roads in the United States intersect, but that is all. As
Cooley says, "Even if a large amount of freight and many
passengers are interchanged, an insignificant 'junction'
and a restaurant are all that is necessary.He adds,
in regard to transport expense, "From one point of view
the number of breaks represents the expense of transporta
tion, and the tendency to dispense with the smaller ones
by means of interchange of vehicles, consolidation of lines,
etc., is a part of the progress of the division of labor.
In the above discussion, a break-in-transport-
point was limited to a physical transfer. Yet there is
another type of transfer of first class importance. It
involves a change of ownership. This can be termed the
commercial break. If, in addition to a physical break in
transport, an ownership change is added, then the condi
tions are created for the growth of a great commercial city.
In addition to the physical transfer personnel, a commer
cial class consisting of merchants performing middlemen
functions, insurance personnel, financial intermediaries,
et cetera is necessary. This class is very important.
9lbid.. p. 99. IQlbid.
65
They are wealthy and have political power. Their "Wealth,"
Cooley states, "tends to a splendid style of living and
draws together a relatively large and various subsidiary
population."** The result is that manufacturing feels a
stronger pull toward this city than to cities that are mere
break-in-transport centers. Consequently, political power
arises here. Often the result is the emergence of the
political capital at the city, where a change of ownership
has occurred.
Mackinder
A very early twentieth century writer, Mackinder,
noted that transshipment points had the effect of increas
ing population. He uses the term "nodal" in order to
describe the pull of certain central places. He states that
the simplest node is the "four ways" or in other words an
intersection. It is here, "Where the publican and the
blacksmith set up their signs,"*2 he says. Continuing he
states, "A spot upon which more numerous land and water
roads converge, as in a defile past some natural obstacle,
**Ibid., p. 92-93.
12
H. J. Mackinder, Britain and the British Seas
(London: William Heinemann, 1902), p. 329.
66
may be said to have a high degree of nodality."^-3 The
process of geographical selection will induce population
increases at certain strategic locations.
Hawtrey
R. G. Hawtrey is one of the few economic theorists
who has tackled the problem of the transshipment point.
In answer to his own question as to how these points arise,
he says that internal means of communication connect places
of production to local centers. Finally, by means of
various lines of communication, commercial connections are
secured to a large distribution center. This center acts
as a distribution point for the world. Products of the
world flow to these great centers. It is here that change
takes place. Hawtrey says, "The special characteristics
of an interpost, or place at which merchant's stocks are
concentrated, is that it is a point at which dispersal to
markets begins and at which, therefore, the decision can
be taken as to the destination of the goods.
Is there a specific principle giving certain large
13Ibid., p. 330.
G. Hawtrey, The Economic Problem (London:
Longmans, Green and Company, 1925), p. 98.
centers favorable advantages? Hawtrey says that the
important lines of communication are relatively few. The
advantage of mass movement of goods will be an overriding
factor. A concentration at one place will ensue. "This
concentration," Hawtrey states, "is designed to fill
frequent and regular trains or ships as nearly as possible
to the limit of their capacity. Only so can the full
benefit be derived from the heavy capital expenditure and
overhead charges inseparable from an effective modem
transport system.
Weber
Alfred Weber produced the first comprehensive work
on the location of industries. His Theory of the Location
of Industries first published in 1909 in Germany, and
translated into English in 1929, presents a theory on the
concentration of industry at certain sites. His whole
concept is based on the orientation of various industries
to a minimization of the costs of production. He develops
what he terms a theory of agglomeration. He explains, "An
agglomerative factor is an 'advantage' or a cheapening of
15Ibid.
68
production or marketing which results from the fact that
production is carried on to some considerable extent at one
place."16
The first agglomerative factor that Weber lists is
economies of scale, created by an enlargement of plant. A
further tendency to agglomeration will be enhanced through
the concentration of several plants of the same industry.
This Weber terms ' ’social agglomeration." Concerning this
advantage, he states,
The local aggregation of several plants simply
carries farther the advantages of the large plant,
and hence that the factors of agglomeration which
create this higher stage of social agglomeration
will be the same as those which created the large-
scale plant.17
Today social agglomeration would be termed external
economies.
Weber lists a number of factors that determine the
benefits of social agglomeration. These include the
development of technical equipment. This specialization
requires subsidiary industries. Besides the development
of new techniques, there must be facilities for repair and
^Alfred Weber, Theory of the Location of Industries
(Chicago: The University of Chicago Press, 1929), p. 126.
17Ibid., p. 128.
69
maintenance of machinery. Only agglomeration can bring
economies of this nature. Another factor is the develop
ment of a labor organization. Marketing facilities are
still another important element created by agglomeration.
Lastly, Weber adds general overhead expenses. Basically
Weber divides agglomerative factors into two categories,
economies of scale and external economies.
Weber goes on to formulate certain laws of agglo
meration. First, Weber develops a concept, the isodapane.
This term originates from "isos," meaning equal, and
"dapane," meaning expense. Isodapanes are circles drawn
around a point of minimum cost for a plant. These circles
connect points of equal cost. Each successive circle shows
mounting costs for a particular firm.
Working with the isodapane, Weber formulates his
agglomeration theory upon the intersection of critical
isodapanes. The point of intersection of the critical
isodapanes from several firms will be the best location
for a town. Weber states, "If its (the manufacturing plant)
critical isodapanes intersect with those of enough other
individual unites to make up a unit of agglomeration, it
will be concentrated with these others."I®
18Ibid.. p. 137.
70
The development of an agglomeration will in turn
attract other industries, whose critical isodapanes were
too far away in the beginning to intersect with the
isodapanes of the agglomerated industries.
Where will the exact position of agglomeration lie?
Weber says that it will be at any point within the inter
section of the critical isodapanes. Transportation costs
may determine the exact point. He writes, "It will be
located at that one of the several possible points of
agglomeration which has the lowest transportation costs
in relation to the total agglomerated outputThis will
be true in a model where labor costs are less important
than the transport factor. However, if labor costs are
relatively more important than transport costs, then final
O A
orientation is to the point of minimum labor costs.
Savings in cost to the firm are the prime reasons
for agglomeration. In addition, an increase in agglomera
tion means a "relative" increase of economies for each
f i r m . Weber expresses the function of agglomeration as
f(M).22
19Ibid., p. 138. 20Ibid., p. 167.
21Ibid., p. 154. 22Ibid., p. 154-155.
71
This represents the additional savings resulting with each
step toward agglomeration. Weber formulates an equation to
express the attraction a large unit exercises over smaller
23
ones. It is c/u^
D A W
As
R ■ radius of agglomeration.
A ■ locational weight of the industry.
s - transport weight prevailing.
He states,
We find that the attraction of a large unit of
industry is directly proportional to the value of the
function of agglomeration, and inversely proportional
to the locational weight of the industry and the
prevailing transport rates.
Yet another factor must be brought into play. It
is the "density of industry." The given quantity of
agglomeration (M) is equal to
2 24
M - *tf R p
M = the given nodal quantity of agglomeration.
R - length of the radius.
p - density of industry.
The length of the radius equals
rATJ
- 25
P
23Ibid., p. 155. 24Ibid. 25Ibid.
72
\ f M
By substituting \| f°r R the equation of agglomeration
we can get either of two equations. These are
26
M _ f(M)
Tf P As
or
A
\|Tf P
The way to interpret the formula is to assume that
A, s, and p are given. Thereby, by inserting M, we can
find the function of agglomeration f(M). Therefore, if
the conditions of agglomeration are known, we can find out
what "scale" of agglomeration will become a factor for an
27
industry. '
Weber's theory was the first real attempt to con
struct a comprehensive theory of location. He concentrated
on industrial location. From this it can be deduced that
the city itself is formed at the point of agglomeration of
a number of industries. Those industries, which create
the economic base of the community, would come under the
application of Weber's Law. Sombart made the distinction
between city founders (the economic base) and city fillers
(the service industries). The last category, the service
26Ibid., p. 156. 2?Ibid.
73
industries, would follow upon the establishment of the
economic base industries.
Weber's theory has been criticized on the grounds
that he does not take into account historical factors in
the growth of agglomerations. This is true, but Weber was
attempting to construct a pure theory of location. More
over, in order to develop a pure theory he ignores
geographical factors. Taking these factors into considera
tion might not detract from the pure theory. However, it
would Introduce elements, in turn making the theory of no
practical significance. Isard also introduces another
nullifying factor, when he states that Weber has ignored
O D
the bargaining ability of the individual entrepreneurs.
Palander
In a sense, Weber's theory does not fit into a
discussion of transportation and population growth. One
might wonder why it was included here. The lack of a
discussion of major transport routes and principal commer
cial cities was a fault in Weber's theory. However, the
Swedish economist Palander attempted to remedy this
2®Walter Isard, Location and Space-Economy (New
York: Massachusetts Institute of Technology, and John Wiley
and Sons, Inc., 1956), p. 180.
74
deficiency. Taking one specific external economy, an
economy not mentioned by Weber, Palander theorizes on the
agglomerative pull of a particular location.
The attraction, felt by industry to a point of
transshipment, is explained by a minimizing of the number
of hauls and loading charges. Because of this economy, an
advantage similar to a market or raw materials orientation
is affected. Thor Palander advanced this idea in his
Beitrage zur Standortstheorie. Unfortunately, this work
is not available. However, it has been elaborated upon
by Hoover. As Hoover says,
It can easily be shown that if materials come from
points on cwo or more different routes and the market
lies on still another route, the minimum transfer-
cost point is at the junction unless one of the ideal
weights exceeds the sum of all the r e s t ."29
Loesch
The reasons for town or city development are dis
cussed by August Loesch in his famous work, The Economics
of Location. This first appeared in 1939. Loesch divides
his discussion into two parts. The first one he calls the
^Edgar m . Hoover, Location Theory and the Shoe
and Leather Industries (Cambridge, Massachusetts: Harvard
University Press, 1937), p. 159 from Thor Palander,
Beitrage zur Standorststheorie. Chapter 12.
75
"Natural System," the second one the "Historical System."
Under the "Natural system" Loesch says that the
establishment of a large individual enterprise, at a
certain site, will create a factory town. In this case,
the factory is oriented to an important raw material source.
A further stimulus to agglomeration is that the demand for
each enterprise is stimulated individually by the associa
tion of a number of similar enterprises.
Loesch continues with a discussion of agglomeration
and its relation to historical reality. He states,
"Historical reality, with its spatial differences in popu
lation density, topography, and natural resources adds
another factor that operates only from an already deter
mined place: the traditional source of supply.
Included within the traditional source of supply are raw
materials, water power, labor services, favorable climate,
and transport services.
Loesch discusses what he terms chance agglomera
tion. Why he calls it chance agglomeration is not
explained, because he mentions influences that are more
^August Loesch, The Economics of Location (New
Haven, Connecticut: Yale University Press, 1954) p. 68-69.
31Ibid., p. 79.
76
than chance agglomeration. The chance agglomerations are:
(1) orientation by a capital city, (2) orientation by main
roads, and (3) the relative distances of similar locations
32
from one another. In regard to transport, he says,
"The order of the regional system creates certain favored
points, where communication routes cross, that offer
special advantages to different enterprises independently
of one another."33
In conclusion concerning city location Loesch says,
Thus we cannot avoid the fundamental difficulty
in locating a town: We can neither neglect the inter
dependence of the locations of the firms directly
concerned nor can we grasp it in its complexity. Even
after exhaustive examination towns continue to be
founded with fingers crossed, and the reason for the
relatively small number of failures is the stickiness
of the location system. The competition among possible
locations is worse than imperfect. In earlier times,
and particularly during the critical periods of tirst
development, it was still further restricted by state
privileges or municipal prohibitions .
Chamberlin
Another important influence in agglomeration is a
factor first introduced by E. H. Chamberlin. Chamberlin
states that a differentiated product will have a demand
curve, sloping from left to right. This is in contrast to
32Ibid., p. 77. 33Ibid., p. 78. 34Ibid., p. 81.
77
Che demand curve for firms operating under perfect
competition. In this last case the demand curve is hori
zontal . A differentiated product may result from differ
ences in producer and retailer location. Naturally, this
last effect is of greatest interest to location theorists.
The significance of the downward sloping demand
curve is that the producer can raise his price without
having his customers desert him. He has a monopolistic
position. Competitors at a distance cannot compete because
of the transport expense. A surplus profit is the result
of an increase in price. Coupled with an increase of price
is a decrease in the quantity offered for sale. Competitors
will enter the area in order to share in the excess profits,
and to provide an additional source of the products.35
Loesch summarizes Chamberlin's argument,
The Chamberlin process, which depends on the
tendency toward a maximization of the number of
independent firms, cannot be carried on from outside
against the favored enterprise. Instead, competition
starts from within. When this leads to a town among
the various enterprises assembled there, the situation
is fundamentally normal. Measured by the number of
•^Edward H. Chamberlin, The Theory of Monopolistic
Competition. 6th ed., (Cambridge, Massachusetts: Harvard
University Press, 1948, pp. 74-116.
78
establishments, the agglomeration will become more
intense the smaller the size of the firms in an
industry at Chamberlin's point.36
Conclusion
The foregoing has been a discussion of contribu
tions by economic thinkers in regard to transportation
and the growth of cities. Very little has been published
on this topic. The ideas of the thinkers presented here,
though adding to the stock of knowledge, is inadequate.
With the exception of the thoughts of Charles Cooley, the
ideas of the other men on cities and transport have been
incidental to other theories they were interested in
developing.
II. THE HISTORICAL GROWTH OF CITIES AND ITS RELATIONSHIP
TO THE GROWTH OF TRANSPORTATION
From Transshipment Point to City
The Ancient World. There is no benchmark date for
the development of the city, transport services, or the
market place. This stretches back into prehistory. The
scope of a city's activities and the increase of its
population was dependent on the transport function.
^^Loesch, o | > . cit.. p. 69-70.
79
The waterway provided this in ancient times. The ancient
cities of Egypt and Mesopotamia were located on rivers.
The Nile, Tigris, and Euphrates were the highways of the
ancient world. Guarding the trade routes was of major
concern during those times. Frontiers were extended, and
wars were promulgated, in order to insure secure communica
tions with other parts of the known world. Mumford says,
If transportation was the most dynamic element in
the city, apart from war, the lack of transport, or
the ease with which it could be disrupted along a
river route by a community that denied passage to
boats, was a threat to its growth, indeed to its very
existence.
As ship handling and building techniques improved,
the Mediterranean Sea became more important. The Greeks
eventually entered into active trade. Many Greek colonies
were established in order to further foreign trade. One
authority says that two main kinds of Greek sea coast
colonies were founded. The first one was the isthmus town.
Trade would be carried on over an isthmus. Corinth was
one city among many that fell into this group. The second
group of cities was located on the entrance to navigable
3?Lewis Mumford. The City in History (New York:
Harcourt, Brace, and World, Inc., 1961), p. 71-72.
80
narrow straits, Chalcis and Byzantium being examples of
this.38
The two great cities of the Phoenicians, Sidon and
Tyre, grew to greatness because of their entrepot functions.
At one time, the Phoenicians were the chief traders of the
Mediterranean world. The City of Carthage developed from
a Phoenician colony and became great because of trade and
maritime activities. Likewise, the City of Alexandria was
one of the great entrepot centers of the ancient world.
It received and exchanged products from the western
Mediterranean, the near east, and Egypt. The great highway
binding these early transshipment centers together was
the Mediterranean Sea.
During the height of the Roman Empire, the City of
Rome was the hub of a great transport network. Originally,
Rome's early growth resulted from a strategic site at the
focus of routes between the mountains and the west central
coast of Italy.^ However, due to the importance of other
10
Fritz M. Heichelheim, An Ancient Economic History
(Leiden: A. W. Sijthoff's Uitgeversmaatschappij N.V. 1958),
p. 240.
^Stuart A. Queen and Lewis F. Thomas, The City
(New York: McGraw-Hill Book Company, Inc., 1939), p. 60.
81
factors, it would be difficult to isolate the importance
of the transshipment point in the economic life of imperial
Rome. At one time Rome's population was swelled out of
all proportion to its socio-economic and political functions
by a system of doles to the many unemployed who flocked
to the city.
The transshipment function became the principal
factor in the growth of many provincial cities under the
Roman Empire. Many cities in France owe their early growth
to this fact. Bordeaux, Lyons, and Arles received the
grains of Aquitania and Dauphiny. Before the Roman occupa
tion Marseilles had achieved importance as a trade center.
Narbonne and Arles dispatched the products of the south by
way of the Rhone and Saone to Belgium and England. The
later Spanish cities of Cartagena, Cadiz, and Malaga were
collecting centers for the Roman world. Corinth in Greece
became the entrepot for that province.^
Europe. After the revival of trade in Europe,
which followed the Crusades, many great cities arose as
commercial and transshipment centers. One writer,
40paul Louis, Ancient Rome at Work (New York:
Alfred A. Knopf, 1927), p. 293.
82
Van Cleff, speaking of the oriental cities, has stated that
Tehran, Merv, Bukhara, Samarkand, and other cities along
the caravan routes linking Europe to India and China, grew
vigorously for hundreds of years. However, in 1498 Vasco
da Gama discovered the all-sea route to India. As Van
Cleff says, "The death-knell of these towns was sounded
and, although they did not altogether disappear from the
map, they dwindled to almost an inconsequential status.
The resurgence of trade in Europe during the
eleventh century was accompanied by the rapid growth of
towns. As industry had not assumed the importance that
it was to achieve after the industrial revolution, economic
importance was associated, as in previous ages, with the
exchange of commodities and the rendering of transportation
services. During the period in which the Islamic invasions
had stopped east-west trade, European cities had been in
a bad state of decline. Henri Pirenne states:
In the economy of the ninth century they (the cities)
no longer had any excuse for existence. In ceasing
to be commercial centers they must have lost quite
evidently, the greatest part of their population.
The merchants who once frequented them, or dwelt
^Eugene Van Cleff, Trade Centers and Trade Routes
(New York: D. Appleton-Century Company, 1937), p. 4.
83
there disappeared and with them disappeared the urban
character . . . . 2
At this time, the cities of Europe performed religious,
political, or military functions. Their economic function
did not go beyond providing a local fair. As no production
or extensive trade was carried on in these cities, they
played the economic role of consumers, drawing on the
surplus of the surrounding countryside.
Many of these cities were influential and wealthy.
However, upon economic revival, in the eleventh century,
the ones not having an advantageous location in regard to
trade routes, notably water, did not grow. Speaking of
certain wealthy towns that were not situated on the high
ways of commerce, Pirenne states, "In the midst of the
flowering which it (commercial revival) inspired, they
remained sterile, like seed fallen upon stony ground. None
of them rose above the rank of mere half-rural market
towns."^3
The cities favored by a good site did not create
the economic revival by themselves. Pirenne, speaking of
^2Henri Pirenne, Medieval Cities (Garden City, N.Y.:
Doubleday and Company, Inc., 1925), p. 43.
43Ibid., p. 104.
84
city development, says, "They were, so to speak, the
crystallization points of commercial activity. This did
not originate in them--it came to them from without, when
favorable conditions of site brought it their way. Their
role was essentially a passive role."44 Continuing, he
states,
In the history of the development of cities, the
commercial suburb was considerably more important
than the feudal burg. It was the suburb that was
the active element, and, as will be seen later,
therein lies the explanation of that renewal of
municipal life which was merely the consequence of
the economic revival.4^
With the slow emergence of trade, certain sites
became favored for the new commercial centers. The many
wandering merchants steadily increased. The trade routes
assumed a pattern. Certain spots came to be the natural
stopping places for these merchants. Again the trans
shipment point assumes great importance. Pirenne, in
listing favorable stopping places for merchants, states
that these were at the foot of an estuary or creek, at the
confluence of rivers, and at the point where a river was
44ibid.
45Ibid.
85
no longer navigable.^ In addition, the merchants required
protection. Consequently, they gathered at those fortified
towns, located propitiously at transshipment points.
In Europe with the growth of trade and commerce
between the tenth and twelfth centuries these selected
cities grew in number and activity. Because of their
advantageous trade situation, and by the market created for
goods through the concentration of population, various
industrial pursuits were drawn to them.
Originally the commercial district of these cities
was a suburb located outside the city walls. Many of the
older fortified cities were termed burgs. Originally the
term burg meant a castle. As merchants settled outside the
walls of these castles or fortified towns, the new suburb
came to be called the "new burg." Faubourg was the exact
term from the Latin forisburgus literally outside burg.^*7
As has been related, the importance of many
European cities resulted from the growth of a transshipment
point. Because the ships were small in this early period,
^^Henri Pirenne, Economic and Social History of
Medieval Europe (New York: Harcourt, Brace and Company,
1933), p. 41.
^7Ibid., p. 42.
86
many of these transshipment points were located far up the
important rivers. However, the size of ships increased
through the centuries. Therefore, it became impossible for
them to navigate the shallow rivers. As a result, the
original port city lost its character as a port. Bremen
is a good example of this. The increasing size of ships
forced the construction of a new port, Bremerhaven,
further down the river.
The City of Paris was originally at the head of
navigation for the river Seine. Likewise, it was a good
site for a river crossing. Its original growth resulted
from the transshipment factor. Another similar example
is the City of London. London was founded at a "bridgehead1
site. London's site was a point chosen for its practical
location to bridge the river Thames during that period.
This spot was also the head of tidewater for the Thames.
Ships were able to float either up or down the Thames on
the tide.^8 Not only London, but many English towns during
the middle ages developed at fords on rivers. As a result,
many town names end with ford, bridge, or ferry.
48 r. W. Freeman, The Conurbations of Great Britain
(Manchester, England: Manchester University Press, 1959),
P-
87
The Transport Revolution, Effect on Population in England
It is difficult to attribute population increases
to transport improvements over the centuries. The trans
port improvements were not spectacular enough to detect
consequent changes in urban population. Regard the Roman
roads. Before their construction, the needs of commerce
were served by mere trails or wide paths. Of course, good
roads had existed in many parts of the known world. The
Romans constructed a comprehensive system of roads. These
were designed to serve military needs. Their effect on
commerce was given scant attention. However, commerce was
stimulated by their construction. Another handicap in
attempting to measure the influence of transportation on
a city's population is the fact that the improvement of
seagoing vessels had proceeded over many centuries.
Economic history presents an exception to the above.
It has been termed the transport revolution. This revolu
tion progressed along with the industrial revolution. For
transport revolution. The improvements were very great
during this period. As a result, the effect on the cities'
population is readily discernible. The first nation to be
so affected was England.
most the term industrial revolution includes the
88
Manchester, England underwent vast changes during
the industrial revolution. It is believed that the textile
Industry had started before 1300. By 1650 Manchester
could not yet muster 5,000 inhabitants. With the appear
ance of the factory system for textiles, the city had grown
to 17,000 persons by 1750. However, transportation was a
problem. An authority states, "Industry and urban develop
ment were alike hampered by primitive transportation
facilities. We read of wagons and caravans of packhorses
going weekly to London and Bristol.^ Between 1750 and
1800, good roads were built and waterways constructed,
connecting the city with Liverpool and with inland towns.
The city had grown to 70,000 inhabitants by 1800. The
late seventeenth century saw the introduction of steam
power into the textile industry. This in itself meant
larger factories and a concentration of these factories
at sites where coal was available. The first great rail
road success, the Manchester and Liverpool Railway, was
opened in 1830. By 1850 Manchester's population reached
400,000.50 xhe effect on Liverpool at the other end of
^Queen, ©£. cit., p. 29.
5°Ibid., p. 30.
89
the line was similar. In 1801 the Liverpool area contained
99,000 inhabitants. It rose to 469,000 in 1851.
As with many western nations during the nineteenth
century, England’s population grew very rapidly. Table I
illustrates this growth for a ninety year period. As well
as the absolute growth in population, another significant
item is the concentration of population into cities. More
over, the increase in the number of cities is notable. In
absolute terms, the City of London received huge increases
in population. However, relatively speaking the medium
sized cities made the greatest gains, as seen by Table II.
During the nineteenth century the City of London did not
grow any faster than the small cities, cities in the 2,000
to 20,000 category."*2
One early population analyst, R. Price Williams,
showed in 1880 that nineteenth century English cities
attained their maximum rate of growth in the decade 1821-
1831. The percentage increase for these cities is shown
in Table III. The growth of these cities has been laid to
the concentration of the textile industry. The number of
^Freeman, o£. cit., p. 109.
52Ibid., p. 48.
TABLE 1
THE DEGREE OF POPULATION CONCENTRATION IN ENGLAND
DURING THE NINETEENTH CENTURY3
Classes of Cities No.
1801
Population No.
1851
Population No.
1891
Population
Over 20,000 . . . . 15 1,506,176 63 6,265,011 185 15,563,834
10,000 - 20,000 . . 31 389,624 60 800,000 175 2,362,376
5,000 - 10,000 . . 60 418,715 140 963,000 262 1,837,054
Total 5,000+ . . 106 2,314,515 263 8,028,011 622 19,763,264
" under 5,000 . » • 6,578,021 * k 9,899,598 • • 9,239,261
Grand total .... • • 8,892,536 * 17,927,609 • 29,002,525
aAdna F. Weber, The Growth of Cities (New York: The Macmillan Company,
1899), p. 43, Table 17.
vO
o
91
TABLE 2
PERCENTAGE OF POPULATION IN CITIES OF ENGLAND
AND WALES DURING THE NINETEENTH CENTURY®
Other Cities All Urban Rural
Great 20,000- Cities Dis- Dis-
London Cities 100,000 20,000+ tricts tricts
1801 9.73 0. 7.21 16.94 • • • * « *
1811 9.93 2.08 6.10 18.11 « • • * • •
1821 10.20 3.27 7.35 20.82 * • • • •
1831 10.64 5.71 8.70 25.05 * • • • •
1841 11.75 6.52 10.63 28.90 * • * « •
1851 13.18 9.40 12.42 35.00 50.08 49.92
1861 13.97 11.02 13.22 38.21 54.60 44.40
1871 14.33 11.50 16.20 42 .00 61.80 38.20
1881 14.69 14.91 18.40 48.00 67.90 32.10
1891 14.52 17.30 21.76 53.58 72.05 27.95
aAdna F. Weber, The Growth of Cities (New York:
The Macmillan Company, 1899), p. 47, Table 19.
92
TABLE 3
THE GROWTH RATE OF ENGLISH CITIES FOR THE DECADE
1821 - 1831a
Brighton . . . .
Bradford . . . . ... 65.5 "
Salford ....... . . . 55.9 "
Leeds ......... . . . 47.3 "
Liverpool . . . .
00
m
•
•
«
Manchester. . . . . . . 44.9 "
Birmingham . . . . . . 41.5 "
Sheffield . . . . . . . 40.5 "
aAdna F. Weber, The Growth of Cities (New York:
The Macmillan Company, 1899), p. 52, citing R. Price
Williams, Journal of the Royal Statistical Society, Vol.
xliii (1880), p. 462-496.
93
pounds of imported cotton increased from
51,000,000 lbs
287.700.000 "
489.900.000 "
53
1813
1832
1841
John A. Hobson divides the early development of
the textile industry into four periods. These are:
1. "The preparatory period of experimental
inventions of Wyatt, Paul, eit cetra to
the year 1770.
2. 1770 to 1792 (circa), the age of great
mechanical inventions.
3. 1792 to 1830, the application of steam power
to manufacture and improvements of the great
inventions.
4. 1830 onward, the effect of steam locomotion
upon the industry (1830, the opening of the
Liverpool and Manchester railway)."54
In regard to the growth of the English cities
mentioned previously, the decade 1821-1831 was significant.
This growth can be attributed to the harnessing of steam
power to factory production. Previously, the small textile
factories of a previous era were scattered over the country
side at locations on rivers, where the water wheel could be
^John A. Hobson, The Evolution of Modern Capital
ism (New York: Charles Scribner's Sons, 1904), p. 60.
5*lbid.
94
most effectively used. Because of economies ot scale ana
location of the work force, the new steam factories found
concentration advantageous, anna Weber states,
it must therefore be clear to every mind that the
decade under discussion (1821-1831) presents in
England a typical instance of the effect which the
growth of manufactures and the development of
centralized industry, has upon the distribution of
population.55
Another decade bringing great growth was the
decade 1841-1851. Weber comments, "In 1841-1851 was
reached the most notable period of concentration of the
century."56 London reached its maximum growth rate at
c
this time. Despite London's growth, the medium-sized
cities did better as Table IV shows. Part of this growth
has been attributed to the growth of the iron industry.
Hobson attributed the rapid development of industry
after 1840 to the introduction of steam locomotion. He
says,
The period 1840 onwards marks the effect of the
new revolution in commerce due to the application of
the new motor (steam engine) to transport purposes,
the consequent cheapening of raw material, especially
of cotton, the opening up of new markets for the
->5yjeber, ££. cit., p. 53.
56Ibid. 57Ibid., p. 49, Table 20.
95
TABLE 4
THE GROWTH RATES OF VARIOUS CLASSES OF ENGLISH CITIESa
Average
Eng.and
Wales London
Other
great
cities
(100,000+)
82
cities
20,000-
100,000
Towns
2,000-
20,000
Total
urban
1821-31 100 126 239 150 95 143
1841-51 100 167 209 182 82 158
aAdna F. Weber, The Growth of Cities (New York:
The Macmillan Company, 1899), p. 54, Table (not numbered).
96
purchase of raw material and for the sale of manufac
tured goods. The effect of this diminished cost of
production and increased demand for manufactured goods
upon the textile trades is measured by the rapid pace
of the expansion which followed the opening of the
early English railways and the first establishment of
steam-ship traffic.58
The effect of the transport revolution is
directly related to the growth of English cities. The
decade of great growth 1841-1851 was most noticeable in
the seaports. Weber states that seven out of ten of the
fastest growing cities were seaports.^ Undoubtedly, the
railroad projects contributed to this, for in 1840 the
United Kingdom possessed 800 miles of railways. This
figure had risen to 6,600 miles by 1850.60
Historical Instances of Transport1s Dynamic Role in Early
America
The determination of transshipment points in
colonial America. In determining the site for a settle
ment, the early colonists in America considered numerous
locations. Many factors were taken into consideration.
Three factors were never questioned, the need for fresh
water, a defensible spot, and a good harbor.
^®Hobson, oj3. cit. , p. 64.
^^Weber, op. cit., p. 54-55. 60jbid., p. 55-56.
97
The Pilgrim fathers, upon reaching Massachusetts
Bay in 1620, were beset by the problem of a suitable loca
tion for the colony. The influence of a good harbor was
the reason for entering Massachusetts Bay even though it
was not their original destination. Upon sighting the
new world, the Mayflower set a course for the Dutch colony
on the Hudson River, it being the original destination,
however, high winds forced the ship to turn back and
search for a safe harbor. Thus, a safe harbor was the
first necessity of the pioneers, and they found this
inside Cape Cod. This safe anchorage, Provincetown Harbor,
on the far end of Cape Cod proved to be only a temporary
halting place. The search for a suitable site had to
continue, for the end of Cape Cod had little to offer
other than a safe harbor. Numerous spots were considered.
A harbor, fresh water, defensible site, and fertile soil
were the criteria in making a choice.
The problem was solved finally by the ship's pilot,
Robert Coffin. He knew of a harbor across from Cape Cod,
named Plymouth by Captain John Smith, who had visited New
England previously.^ He advised that they make the
^George F. Willison, Saints and Strangers (New
York: Reynal and Hitchcock, 1945), p. 152-3.
98
settlement there. Consequently, on December 11, 1620,
Coffin led a group of Pilgrims to the chosen harbor. It
was sounded and found to be deep enough for ships. More
over, there were fresh springs in the vicinity. Thus
Plymouth was chosen. A good harbor was of the utmost
importance, as it provided the means of communication with
Europe.
The earlier founding of the Virginia Colony in the
Chesapeake Bay region presented a similar situation.
Jamestown was located on an island for two reasons,
defense and the presence of a harbor. More desirable
sites were available on the James River for a settlement.
However, it was felt that an island was more easily de
fended from both Indian enemies and European foes. The
second qualification which this island presented, was the
ability of ships to come close enough to be able to tie
up to the trees. Another site, a point of land they had
named "Archer's Hope," was considered. It had some
advantages over Jamestown, but unfortunately, the shallow
water nearby would have forced ships to lie too far
offshore
^Philip A. Bruce, Economic History of Virginia in
the Seventeenth Century, Vol. 1, (New York: The Macmillan
CoT, 19U/)~ p.T92~' ------
99
The economic history of the Chesapeake Bay region
shows to what extent the importance of transport played as
a factor of production. During the first years of the
Virginia Colony, numerous crops were grown and industrial
pursuits tried. Glass making and iron mongering were among
the first. The purpose of the colony was to supply England
with industrial raw materials. However, these projects
were doomed to failure. For example, the naval stores
produced could not compete with Scandinavian or Russian
naval stores because of the high trans-Atlantic transport
costs. The same thing was true of other articles. High
transport costs to England made it difficult for Virginia
produced commodities to compete with similar European
articles.
The answer to the dilemma was in the production of
the one commodity in which tidewater Virginia and Maryland
had an absolute advantage, tobacco. John Rolf experimented
with the plant in 1612. Later, according to Bruce,
'fexperienced English judges declared it to be of superior
quality."^3 Soon the boom was on. Tobacco was even
planted in the fort and streets of Jamestown. In 1616
63Ibid., p. 217.
100
eleven commodities had been sent to England. By 1619, the
growing of tobacco forced the abandonment of other export
oriented enterprises. As a result, only tobacco and a
little sassafras were sent to England.64 Tobacco produc
tion increased as follows:
1622 ............... 60,000 lbs.
1628 ............. 500,000 lbs.
1639 ........... 1,500,000 lbs.
1700 ........... 20,000,000 lbs.
1775 ......... 100,000,000 lbs.65
The success of the Virginia colony is attributed to
tobacco. However, one factor insured the success of the
enterprise, namely the ease in which the tobacco was
loaded onto ships.
A look at the Chesapeake Bay is self-explanatory.
The bay is the largest inlet on the Atlantic coast of the
United States. It is 200 miles long and from four to 40
miles wide.66 The major rivers entering the bay are the
Susquehanna, Patuxent, Potomac, Rappahannock, York, and
James. The significant thing is the ease of access that
the bay and tributaries afforded to the ships of the
64Ibid.. p. 235.
^Arthur p. Middleton, Tobacco Coast (Newport News,
Virginia: The Mariners' Museum, 1953), p. 94-95.
^Encyclopedia Britannica (Chicago: William
Benton, 1960), Vol. 5, p. 421.
101
colonial era. There are 150 rivers, creeks, and branches
in the bay. Forty-eight of these are principal tributaries.
From the Virginia capes, Cape Charles and Cape Henry,
there is a navigable distance of 1,750 miles. More impres
sive than this is the fact that the total shoreline of
Chesapeake Bay and the tidewater portion of its rivers, is
estimated at 4,612 miles.67
The ships of that era could navigate the larger
rivers. Naturally, the smaller vessels could ascend much
higher. The James River was navigable as far as the falls
near the present city of Richmond. It is 160 miles from
these falls to Cape Henry to the east. The York River was
easily navigated the first forty miles from its mouth.
Here it branched into two smaller rivers. Each admitted
small vessels for 70 miles. The Rappahannock River was
navigable to the falls near the later city of
Fredericksburg. This is a distance of 100 miles from the
river's mouth. The Potomac River was navigable 140 miles
from its mouth. Georgetown developed eventually at the
head of navigation of this river. The Patuxent River was
navigable for 50 miles, the Patapsco River for 15 miles.
^Middleton, 0£. cit. , p. 31.
102
The Susquehanna River, though large, was only navigable
for five miles. On the eastern shore of Chesapeake Bay,
there are numerous small rivers and inlets. Though not
as impressive as the rivers on the western side, they
permitted some navigation.68 The total drainage area of
the Chesapeake region is 64,900 square miles. Of this,
10,000 square miles of hinterland are directly accessible
to Chesapeake Bay and its tidewater tributaries.
With the intense cultivation of tobacco, the area
soon blossomed into tobacco plantations. As preceding
figures testify, production increased rapidly. In addition
to ideal soil and climatic conditions, the production of
tobacco was made possible by the fact that tobacco could
be loaded directly onto ocean going ships, from the
plantation or a point close to the plantation. The
tobacco was packed into large hogsheads that were rolled
down to the waters edge. Because of the fragile nature of
tobacco it was impossible to roll the hogsheads over 20
miles without the delicate leaves suffering damage. Easy
transportation was indispensable.
68Ibid., p. 32-33.
103
As a consequence, and despite the growth of the
colony, a noteworthy attribute was the absence of towns.
With the transshipment function taking place at the
individual plantations, no town was needed to perform this
function. This was true of the seventeenth century.
Middleton says,
As late as the beginning of the last quarter of
the century (seventeenth century) there existed not
a single incorporated town in Virginia or Maryland
and only two villages of any size, Jamestown and
St. Mary's. As soon as the capital of its colony
was removed from each of them, these two villages
fell almost immediately into decay, and half a century
later were as dead as Troy or Herculaneum.^9
During the eighteenth century, towns of consequence
appeared in the Chesapeake area. Their prosperity arose
with the warehouses established under the tobacco inspec
tion acts of 1730 in Virginia and 1747 in Maryland, and
with the stores established to do a retail business.
As settlement spread inland from the coast, the
Piedmont plateau began to export tobacco, wheat, and corn.
European and West Indian goods were imported. Here one
finds the development of a town originating from a trans
shipment point. The tidewater area and the Piedmont is
69lbid.. p. 40.
104
delineated sharply by what is termed the fall-line. The
fall-line at the rivers is marked by rapids or falls. Many
of the ships of the colonial period could ascend these
rivers to the fall-line. With the development of the
Piedmont region, goods for the interior had to be dis
charged at or near the fall-line and loaded onto another
conveyance, for the journey to the interior. Needless to
say, exports leaving the Piedmont area followed the same
process. The fall-line was the start of cheap water
transportation. Warehouses, stores, inns, livery stables,
port facilities arose at these transshipment points.
Eventually towns emerged. Some of these towns
later assumed historical significance. There is Richmond
on the James River, Petersburg on the Appomattox River,
Georgetown and Alexandria on the Potomac River, and
Fredericksburg on the Rappahannock River. In fact, the
city of Baltimore is a fall-line town on the Patapsco River.
The successful Erie Canal, a builder of cities in
New York State. The success of the Erie Canal was
publicized far and wide. As Van Metre says,
It became, for a time, the most important single
artery of commerce in the United States, and it
probably had a greater influence upon the economic
development of New York and of the United States as
105
a whole than any single agency of transportation
the country has ever possessed.70
The effect upon the west and upon New York City was
profound. Less well-known,but no less phenomenal, was the
canal's effect upon the towns which lay along the course
of the Erie Canal. Naturally, it is to be expected that
the terminal points, Buffalo and Albany, would feel
immense changes. However, a striking effect was also
produced on all canal cities.
In anticipation of the site for the canal's
western terminus, an intense rivalry developed between
Black Rock and Buffalo. Each realized that the selection
of a western terminus would insure its success as a future
city. The effect of the canal upon the economic geography
of western New York State was fully sensed. The rivalry
between the two cities developed into what is known as
"the Buffalo and Black Rock War." The intensity of the
rivalry even forced a postponement on the decision of a
western terminus. Canal construction was well under way
before a decision was made. History has proved what the
townsmen of Buffalo and Black Rock anticipated, the success
70yan Metre, o£. cit. . p. 24.
106
of one as against the failure of the other city. Buffalo
grew and incorporated Black Rock into its fold. The effect
of the canal was immense and its success beyond the wildest
dreams of its promoters. For instance, between 1820-1830
the population of Buffalo rose 314 per cent.7* -
Again it was the case of a village strategically
located at a transshipment point. Because of its geograph
ical site, it is the natural eastern terminus of the Great
Lakes trade. With the completion of the Erie Canal, it
became an important transshipment point. Not only did
produce of the Great Lakes region flow through Buffalo,but
products from the Mississippi Valley as well. Some deepen
ing of the harbor was necessary in order to accommodate
lake vessels. From the opening of the canal in 1825 until
1830, entering tonnage increased six times. Moreover, the
population quadrupled. Port traffic grew to such an
extent that by 1850 six hundred sailing vessels and one
hundred-fifty steamers used Buffalo as the eastern Great
7 0
Lakes terminus. * Its industrial growth began immediately.
^Margaret L. Plunkett, "The Upstate Cities and
Villages,” Alexander C. Flick (ed.), History of The State
of New York, Vol. 8 (New York: Columbia University Press,
1935), 40.
72Ibid., p. 58.
107
The year 1826 saw the establishment of a foundry to make
iron plows and castings. This first industry grew to
forty factories by 1832.^
Syracuse and salt are synonymous. However, before
the Erie Canal the salt industry was retarded by poor
transport to New York City, the only large-scale market.
The canal created the possibility for a large-scale salt
industry. The year 1825 saw the incorporation of Syracuse
as a village. By 1847 it attained the stature of a city.^
Besides salt, gypsum also became an important export.
Another town, Rochester, became, with the advent
of the Erie Canal, a market place and a collection center
for the wheat and farm products of the Genesee River
Valley, and for the shores of Lake Ontario as well. Flour
milling became prominent. Between 1816 and 1835, flour
mills increased from seven to eighteen. During this same
period the population increased from 330 to 14,000.^
Local industries arose such as tanneries, iron foundries,
lumber mills, and brickyards.
The important City of Albany, on the upper Hudson
7^David M. Ellis, James A. Frost, Harold C. Syrett,
Henry J. Carman; A Short History of New York State (Ithaca,
New York: Cornell University Press, 1957), p. 502.
74piunkett, oj>. cit., p. 55-56. ^^Ibid., p. 57.
108
River, felt a great impetus from the Erie Canal, although
Albany was a thriving town before the canal opened.
Therefore, the canal's effect was not as profound with this
city as with the Erie Canal towns. Utica and Rome also
prospered. However, their growth was not as pronounced as
it was for the other towns. Utica had been a center of
land travel before the canal. After the canal opened,
Utica began to develop manufactures. As with many another
town, canals helped the development of Rome. An early
canal, the Black River Canal, terminated here.
Another Hudson River town, Troy, found its fortune
in the canal era. Its site is at the head of navigation
for the Hudson River. Furthermore, it is opposite the
mouth of the Mohawk River. Numerous roads to the east
converge here also. An early canal, the Champlain, gave it
access to the North. Then, with the completion of the
Erie Canal, a link to the West was provided. With the
iron areas of Lake Champlain available iron products
became important. Stove manufacturing became famous. The
manufacturing of carriages and coaches gave Troy fame. As
early as 1830, Troy's manufacturing placed it among the
state's important cities.^
76ibid., p. 46.
109
An assumption should not be entertained that such
success was true of all the canal projects. The success
of the Erie Canal created a "mania" for canal construction.
Many of these canals often achieved moderate success.
Others were dismal failures. Certainly, it cannot be
assumed by observing one success that all such ventures
were profitable. The Erie's great boom is attested to the
fact that its 363 miles of canal meant a linkage in a
12,000 mile all-water route across the northeastern part
of the United States. This route included, besides the
Erie, the Hudson River, Lake Erie, and Lake Ontario.
Moreover, the Erie's success can be attributed to the
expansion of the west which had commenced in the 1790's
into the Ohio Valley. Thus, by 1825, the Erie Canal
linked a well developed eastern region, New York City and
the Hudson River area, to western lands well on their way
to complete settlement.
The growth of selected inland transshipment points.
After the settlement of the eastern coastal areas, the
Ohio River Valley, a segment of the Mississippi River
system, became the new frontier. This valley and the
Mississippi valley illustrate the effect of river ports
110
upon city growth. A quick look at this area is rewarding
in that it affords the last chance to observe the inter
action of an inland river system, its ports, and the
hinterland areas upon economic development, for soon the
railroads were to come and dominate the American scene.
The settlement of the Ohio River Valley commenced
after the Revolutionary War. One early settlement,
Marietta, was chosen because of the belief that it lay on
the future trade route between Lake Erie and the Ohio River.
This was in 1788. However, this commerce did not become
important until 1825.^
An obvious instance of the growth of a city
resulting from a break-in-bulk point of transportation is
Louisville, Kentucky. The necessity for this break
resulted from the presence of a section of rapids or falls
in the Ohio River at Louisville. It is an example of city
growth resulting from a break, when there was no change in
the mode of transport. Only at certain times of the year
could the falls at Louisville be passed over without
^ Wi l l i a m f . Gephart, Transportation and Industrial
Development in The Middle West,(New York: Longmans Green
and Company, 1909), p. 30.
Ill
difficulty. Xn the early days of the steamboat, before a
canal was constructed around the falls, steamboat travel
between Cincinnati and Pittsburgh on the upper Ohio and
the rest of the Mississippi River system was obstructed by
these falls. In going to New Orleans from Pittsburgh, a
change was necessitated at Louisville. Thus, Louisville's
gain as a city was made at the expense of the rest of the
Ohio Valley.
As early as 1818, a newspaper, the Cincinnati
Gazette, commented on the extent Louisville was enriched
each year by the returns from storage, and other gains by
transfer and delay at the falls.7® In 1826, the
Cincinnati paper complained that of the 5,000 flatboats
that passed over the falls each year, at least 3,000 of
them required a pilot. The paper stated that this meant
an outlay of $15,000 for this class of carriers alone.79
However, craft larger than flatboats were forced to unload
their cargoes at the falls and to have them carted to the
other side. Gephart lists a number of disadvantages for
the Ohio Valley from this procedure. The most important
?8lbid.. p. 109.
79Ibid., p. 107.
112
are: (1) Drayage at $.75 per ton, (2) injury to cargo in
handling, (3) interest on idle capital due to delays, (4)
loss of perishable goods, and (5) the loss of flatboats
which could not ascend the river.®® Thus Louisville
received its growth impetus from this transfer function.
As early as 1780, it was one of four villages on the Ohio.
At that time it was the only place on the lower Ohio with
a store.
Pittsburgh, where the Ohio River begins, developed
early as a point for the shipment of goods from western
Pennsylvania. This town became active in the construction
of all types of river craft for the carriage of goods
downstream. Its most obvious growth as a transshipment
point came with the completion of the "Main Line" a hybrid
canal and railroad, which had been constructed from
Philadelphia to Pittsburgh in order to secure for Philadel
phia a greater share of the western trade. As Van Metre
says,
Nearly all the traffic between the Central States
and Philadelphia passed through Pittsburgh, which was
situated in an advantageous position at the western
terminus of the Main Line Canal and occupied the same
80Ibid., p. 108.
113
relation with regard to the trade over that waterway
that Buffalo occupied with regard to the trade over
the Erie Canal. From Pittsburgh the merchandise
coming from Philadelphia and Baltimore was distributed
by means of the Ohio River and the canals and railroads
of the Central States among the towns of Ohio, Kentucky,
Indiana, Illinois, Missouri, and Tennessee, and even
to Mississippi and Arkansas. In addition, Pittsburgh
sold large quantities of iron, glass, and bituminous
coal to the various cities down the river, and received
flour, provisions, and tobacco for local trade and for
transportation to Philadelphia and Baltimore.81
The "Main Line" eclipsed the entrepot function of Wheeling,
Virginia which had enjoyed trade advantages due to the
arrival of the Cumberland Road in 1818.
Another important river city has been Cincinnati,
Ohio. Here the port function performed by that community
was very significant in its rise to prominence. With the
advent of railroads and highways, other industrial areas
gained on Cincinnati. However, during the first half of
the nineteenth century the city held a commanding position
in western trade. Gist in 1841 stated,
Its commerce is coextensive with the navigation of
the west, and its interior trade is spread over the
whole extent of country between the river Ohio and
®*T. W. Van Metre, "Internal Commerce of The United
States," Emory R. Johnson, T. W. Van Metre, G. G. Huebner,
and D. S. Hanchett, History of Domestic and Foreign
Commerce of The United States. Vol. 1, (Washington, D. C.:
Carnegie Institution of Washington, 1915), p. 236.
114
Che Lakes north and south, and the Scioto and Wabash
river8 east and west; the eastern half of Indiana and
southern Ohio are the most Important customers for the
foreign goods from this market, and the lower Missis
sippi country for our various manufactured articles
and the provisions sold through this market.82
The area about Cincinnati was rich In resources,
another impetus for growth. In the early 1850's, immense
products of the north from Ohio, Indiana, and Kentucky
were exchanged for the southern products of sugar, tobacco,
molasses, and cotton. Moreover, the manufactured goods of
this city were sold far and wide. As Gephart paraphrases
an early newspaper article, "Cincinnati had become a great
storehouse of goods, a warehouse of grain, a manufacturer
of tools, machines, and furniture."83 its decline in
importance commenced with the introduction of the railroad
and good highways. Its location on the Ohio River had
been a prime source of importance. One source states that
in the early 1840's 2,000 Cincinnati residents found
employment either on or in connection with the river.
Mention should be made of two important cities that
S^Qephart, o£. cit. , p. 254. ^ Ibid. t p. 255.
®^Charles H. Ambler, A History of Transportation in
The Ohio Valley (Glendale, California; The Arthur H.
Clark Company, 1932), p. 164.
115
developed before the railroads, but which lie to the west
of the Ohio valley. The first one is Chicago. Again, one
finds that the spot of a break in bulk in transport is the
primary cause of an inducement for settlement. The site
of the future city was determined by the Chicago Portage.
This portage came to be used by the French who were able
to communicate via the Great Lakes with the Mississippi
region from their settlements on the St. Lawrence River.
The Chicago Portage consisted of a short trail which con
nected the Chicago and Des Plaines Rivers. The latter is
a branch of the Illinois River. The Chicagp River empties
its waters into Lake Michigan at the site of present day
Chicago. In passing from Lake Michigan to the Mississippi,
one simply had to ascend the Chicago River, then portage
overland to the Des Plaines River, and descend it. In
turn this river merged into the Illinois River. The
Illinois River flowed into the Mississippi River at a
point above St. Louis. In the early years of colonization,
the English remained on the Atlantic coast because of the
Appalachian mountain barrier to the west. However, the
French by using the Saint Lawrence, Great Lakes, and then
the Mississippi River system found an easy access to the
west. The two French explorers, Marquette and Joliet
116
learned of the portage from the Indians in 1673. Marquette
speaks of the portage as being only one-half a league in
length.®^
Chicago was destined to develop at the mouth of
the Chicago River. Here was a necessary stopping place.
Traffic coming down Lake Michigan would halt at this site
before venturing up the Chicago River. Chicago soon
became a regular stop for French fur traders and mission
aries. La Salle, the French explorer, completed a stockade
and a cabin at Chicago in 1683. However, there was no
city growth until the nineteenth century.
The 1830’s saw the creation of harbor facilities.
Because of this advantage, and the proposed Illinois and
Michigan Canal, Chicago became the western terminal for
traffic coming from Buffalo. In 1848 after years of delay,
the Illinois and Michigan Canal was completed over the old
Chicago portage; although it was soon to be eclipsed by
the railroad.
The second city, St. Louis, also became a great
®^Bessie L. Pierce, A History of Chicago (New York:
Alfred A. Knopf, 1937), p. 7, citing Marquette's Journal,
1673, in Jesuit Relations, LIX, p. 161.
117
entrepot for the west. One writer states, "By 1855
St. Louis was the greatest steamboat center on the western
86
waters." Originally, it had been founded as a convenient
location for a fur trading company.
This review of the importance of a few inland
river ports within the United States has sought to eluci
date to a greater degree the importance of the break in
bulk transport point in the development of a city. Usually,
we associate this development with the ocean port. However,
river ports have been important as well. The development
of the railroads has overshadowed inland waterway systems.
Consequently, the river port has lost much of its
importance. Gephart summarizes this position by stating,
Land transportation, especially in the case of
railways, has received so much attention to the
exclusion of inland waterways, and such excellent
systems have been developed that the present genera
tion does not attach much importance to the small
inland rivers.87
The areas to the west of the Mississippi River
and its tributaries were to feel the full effect of the
railroad. Older means of transport, with their influence
®^Ambler, o£. cit., p. 201-202.
®^Gephart, o£. cit., p. 64.
118
in developing centers of distribution, were not to be as
influential in the Far West. For now a means of transport
was available which was freed from many natural limitations.
This new form, the railroad, could lay its tracks anywhere.
The only impediments were natural barriers such as
mountains that were to require additional outlays of
capital in order to overcome them.
CHAPTER IV
THE HISTORICAL ROLE OF THE SEAPORT, THE
DISTRIBUTION OF POPULATION,
SOME COMPARISONS
I. INTRODUCTION
Turning to the west coast of the United States,
the principal is illustrated again that nodal points in
the transport network show the greatest growth. As
previously described, nodal points in the transport network
will arise from break-in-bulk transport sites.
An example of the above is the case of the City of
San Francisco. Before the gold rush of 1849, the village
of Yerba Buena was at the site of the present city. How
ever, with the introduction of an activity of major
economic importance into California, some village or site
was destined for greatness. The impetus for this commer
cial greatness came from the necessity of a change in the
mode of transport for both men and goods.
Before the gold rush of 1849, California's
119
120
commercial life comprised the exportation of hides and
tallow, and the importation of manufactured articles plus
a few luxury items. This trade was carried on at numerous
landing places along the coast, a phase of California's
history described by Richard Henry Dana in his work, Two
Years Before the Mast. This type of economic activity
required no large cities or ports. Good natural harbors
existed,for example, San Francisco Bay, Monterey Bay, and
San Diego Bay; but they were not fully utilized. Popula
tion and a commercial life were necessary before cities
could come into existence.
II. CHARACTERISTICS OF SAN FRANCISCO'S INITIAL
PERIOD OF GROWTH 1850-1880
Economic Factors
The City of San Francisco, located on San Fran
cisco Bay, had from the beginning an admirable geographical
location. It was endowed with a fine natural harbor, being
deep and well-protected. Moreover, a vast hinterland in
the interior, California’s central valley awaited future
development.
The major economic activity that brought growth to
San Francisco was the discovery of gold. Soon adventurers
121
from the entire world were to throng to the foothills of
the Sierra Nevada Mountains in search of the yellow metal.
A large segment of this movement entered California from
the sea. San Francisco Bay was the natural link in the
transport system to the mining areas. From San Francisco,
an all water route exists into the interior which takes
one close to the gold fields. The port of entry for the
miners and adventurers of '49 was San Francisco. Here a
change of transport was necessary in order to continue the
trip further into California. Once again, the site of a
future city rests at the place of stopping in order to
change the means of conveyance. Ocean going ships left
their cargoes and passengers at the spot. From here,
craft suitable for navigating the Sacramento or San Joaquin
Rivers loaded the cargoes and travelers destined for the
gold fields. Conversely, products and goods coming from
the interior were destined for transshipment at San
Francisco.
Earlier in this paper, it was stated that Cooley
distinguished between a simple break-in-transport point and
a commercial break. With a commercial break, numerous
middlemen and financing agents assume importance: banking,
insurance, warehousing develop. A commercial break did
122
exist at San Francisco, thus a basis was laid for a great
commercial city. From commerce It Is but one step to
manufacturing, providing other conditions are right.
Transportation, labor, and raw materials are required.
In San Francisco the first requirement was present. How
ever, labor and raw materials had to be imported. San
Francisco's strategic geographical location and its
function performed as a port city was an overwhelming
factor to the inducement of industrial growth.
Not long after the commencement of the gold rush,
the needs of the pioneers created a demand for a wide
variety of goods. Thus by the 1850's, industrial growth
was commencing in California, particularly in San Francisco.
Soon manufacturing was to take an important place in the
economic base of the city. Many industrial firms were
begun. For instance, two large factories for making stage
coaches were started in 1851. Rice mills were begun in
the 1850's. One firm, the Joseph Wagner Manufacturing
Company became one of the largest milling machinery
manufacturers in the United States and was the only one on
the west coast. It supplied machinery to many Pacific
Ocean nations.
Although many obstacles had to be overcome, the
123
great demand for mining machinery during the gold rush
created an iron industry. In the beginning, both coal and
labor had to be imported. "In 1860 San Francisco had
fourteen foundries which employed 220 men."*- After the
gold rush the industry foundered for a time. However, by
1881 it was again thriving, and 1200 men were employed.
As one would expect, the industry was beginning to diver*
sify. Cable railways, water pipes, and locomotive building
became important. One of these iron foundries had business
extending from British Columbia to South America. Ship
building soon came to play an important role. Small craft
had been built in the area even before the American
occupation. In 1864 the Del Norte, the first ocean going
steamship built in California, was launched. In 1880
there were 62 small shipbuilding firms. In 1882 four ocean
steamers were launched.
San Francisco benefited by obtaining building
projects from the federal government. In 1889 and 1890
two steel warships, the Charleston and the San Francisco,
were built by the Union Iron Works. In 1892 a harbor
^The Bay of San Francisco, (Chicago: The Lewis
Publishing Company, 1932), p. 306.
124
defense ship, the Monterey, was being built. The same year
this firm had an order for a cruiser and a battleship. The
Marine Hospital was built in 1853. Because of the ease of
entry into the interior of California, a great amount was
spent on fortifications in the area. A first-class arsenal
was constructed at Benicia. Fortifications were estab
lished at Alcatraz with 141 guns, Fort Point with 164 guns,
Lime Point with 50 guns, and Presidio Hill with 50 guns.
A Navy Yard was established also at Mare Island.
The refining of imported sugar from Hawaii became
important. The first refinery was established in 1855.
Spreckels established one in 1863, followed by a second
one in 1869, and a third one in 1881. In 1885 the American
Sugar Refining Company was begun which gave employment to
500 men and to as many more in service industries.
Despite the fact that the industry was hampered
in the beginning by the lack of fine hardwood, furniture
manufacturing grew and was given an impetus by the Civil
War. There was a great demand for billiard tables in the
West which definitely stimulated this industry. One firm
specialized in making billiard balls. In 1888 twenty-four
furniture factories were in business employing 1,000 men.
125
In 1884 the American Oil Company was organized
to produce greases, oils, and paints. Their market
extended over the entire Pacific Coast.
The California Electrical Works was formed in
1870 through the consolidation of smaller companies. They
manufactured brass articles, telegraphic instruments,
electric bulbs, electrodes, and dynamos.
Paper manufacturing, printing, and bookbinding
grew. Box making also arose because of the increase in
the drying and canning of fruit as agriculture progressed.
California in 1889 produced 1 1/2 million cases of fruit
and 1 1/2 million cases of vegetables. Two-thirds of the
canning was done in San Francisco.
The Pacific Coast Borax Company located the
world's largest borax refinery at Alameda. Four hundred
tons of borax were produced monthly during this era.
There were smaller manufactures, such as cigars,
silk, leather goods, including shoes and saddles, made in
the San Francisco area. Musical instruments, especially
pianos, were being produced here also.
Naturally, the transportation industry became very
important. The first surge in shipping took place from
the beginning of the gold rush to 1853. It then declined,
126
but with the growth of population and general business
conditions it arose again. The bay and river steamers put
San Francisco in touch with the rest of the bay area, as
well as Sacramento and other river towns. In 1869 the
transcontinental railroad was finished. This put northern
California in direct contact with the east. In California
railroad building activities radiated from San Francisco;
however, the water barrier allowed only one line, the
coast route of the Southern Pacific, to actually penetrate
the city.
Despite the number of industries established in
San Francisco, an economic survey taken of the area has
stated, ’ ’ Various minerals in limited quantities are found
within the area, but no major industries have been based
on them.' Furthermore, although San Franciscan industries
have exported to the whole world, this survey states, "The
growth of manufactures in California and the bay industrial
area before 1900 was limited and characterized largely by
small factories serving the local market.
^Robert D. Calkins and William E. Hoadley, Jr., An
Economic and Industrial Survey of The San Francisco Bay
Area, (Sacramento, California: State Planning Board, 1942),
p. 2 .
3Ibid., p. 12.
127
Population Changes
With the arrival of spring, in the year 1848,
rumors were flying about California of the discovery of
gold at Sutter's Mill. The movement to the mining dis
tricts began slowly. However, before long it was a "mad
dash" to the mines. One source states, "Before the fall
of 1848, probably three-quarters of all the men in towns
in California had departed for the mines.Many towns
were virtually depopulated. The historian Bancroft
observed of San Francisco that, "It was as if an epidemic
had swept the little town so lately bustling with business,
or as if it was always morning there."-* However, this did
not last for long. A tide of humanity was soon on its way.
San Francisco's population rose from 1,000 in 1848, to
10,000 in 1849, reached 20,000 in 1850, and in January of
1851 was estimated at 35,000. During 1849 the San Francisco
Custom House recorded 39,000 people arriving by sea.
Bancroft estimated that 42,000 persons reached California
by coming overland during that same year.^
^Commonwealth Club of California. The Population
of California (San Francisco: Parker Printing Company,
1946), p. 2-3.
5Ibid., p. 2. 6Ibid,, p. 3.
128
Changing Totals. As noted above, the initial
population increases were quite startling for the San
Francisco area. Even though the percentage increases were
not as great in the subsequent years, the actual population
increases were numerically greater, as the following
figures testify. These figures are for the County of San
Francisco.
1850 ............. 20,000 (stated above)
1860 ............. 56,802
1870 ............. 149,473
1880 ............. 233,959
1890 ............. 298,997
1900 342,782 7
The following are the percentage increases for the
County of San Francisco for the same years.
1850-60 .... . . 135 per cent
1860-70 .... . . 163
IV VI
1870-80 .... . . 57
IV VI
1880-90 .... . . 28
IV 11
1890-1900 .'. . . . 15
v r
" 8
Migration. Many factors affect population totals.
These factors include birth rates, deaths rates, and
migration. In the case of the initial stages of the growth
of California cities the effect of migration was very
important. The large numbers of migrants entering the
7warren S. Thompson, Growth and Changes in Califor
nia1 s Population (Los Angeles: The Haynes Foundation, 1955),
Table 1, p. 333.
8Ibid., Table 2, p. 334.
129
state made them an important source of population increase
in California. The effect of the discovery of gold in
1848 brought an avalanche of migrants to not only the gold
fields but also to San Francisco. However, one should not
discount the effect of birth or death rates. According to
Thompson, approximately one third of California's popula
tion increase came from the natural increase between the
years 1860-1890.9
Migration is an important study in itself. Two
sets of forces operate on the migrant. The first one is
the "pull" factor or that force which attracts people to
certain areas. Economic opportunity undoubtedly plays the
primary role as a "pull" factor. The fantastic opportunity
to obtain a fortune with relatively little effort drew the
49'ers to California. Expanding opportunities in industry
and trade became important. California's mild climate,
though not much of a factor in the beginning, took on more
importance as time progressed. The fact that California
was the terminus in the westward movement also bears
consideration. After California there was no place to
migrate to. The "pull" forces have been the most important
9Ibid., p. 31.
130
factor In California's population explosion.
The "push" forces, however, should not be over
looked. These may be the result of economic conditions in
one area being so poor that workers are forced to leave
and seek employment in other areas. Political conditions,
if adverse, may also operate in the same fashion. Religious
persecution may be another "push" force. Examples of
"push" forces include the Irish Potato Famine which drove
thousands of Irish to the new world. The Taiping Rebellion
in 1850 drove thousands of Chinese to Hong Kong and Macao
in search of employment. Unable to find it, many left for
California. Revolutionary events in Germany in 1848 drove
many Germans to California in this early period.
Special incentives were advanced to encourage
migration to the San Francisco area. For example, the
French government sponsored an emigration society, which
resulted in the arrival of 131 Frenchmen in San Francisco
in 1850. This was not the only incentive put forward by
the French. As one source states,
Another device of the French Government in Gold
Rush days was "L*Ingot d'Or," a lottery which offered
as a grand prize a gold nugget valued at $20,000,
proceeds of the lottery to be used to pay the passage
131
of 5,000 emigrants from France to California.1®
About 3,000 Frenchmen did reach California out of this
total. Australia offered pardons to convicts willing to
migrate. In San Francisco the "Sydney Tows," as they were
called, became notorious for the crimes they committed.
San Francisco businessmen in 1869 formed the
California Immigrant Union. The idea behind this society
was to attract immigrants from Europe and the eastern
United States. They specifically desired small farm
operators. This society was followed by a more ambitious
group, known as the Immigration Association of California.
There was yet another private organization, The California
Promotion Group. State, county, and city governments
promoted immigration through various channels.11
Though there are no tables for net migration into
either San Francisco or Los Angeles, one was found which
gives the net effective migration into California based on
estimates from Census state-of-birth data. These figures
are:
lOCommonwealth Club of California, 0j>. cit. , p. 36.
11IbjLd., p. 37-40.
132
1860-70
1870-80
1880-90
109,000
172.600
255.600
1890-1900 ....... 179,200 10
1900-1910 ....... 775,300 12
Of course, one might ask, where did the migrants
come from? One must remember, as stated earlier in this
paper, that one-third of California's increase in popula
tion between 1860-1900 resulted from natural increase.
Nevertheless, in 1850 New York supplied 14.6 per cent of
California's native-born increase, California itself
supplied 9.5 per cent, and Missouri supplied 8.5 per cent.
The remainder was supplied from other sources. From 1860
onward, California supplied the greatest single source of
population increase. The second most important source
between 1860-1900 for native-born increase was New York,
though its percentage fell steadily from 12.3 in 1860 to
5 per cent in 1900. Missouri consistently held third
place between 1850 and 1880. Massachusetts and Ohio were
13
also steady suppliers of new people between 1850 and 1880.
The above percentages apply to the state as a whole. As
far as the origin of San Francisco's native-born population
12Ibid., Table 14, p. 52.
13Ibid., Table 27, p. 91.
133
Is concerned, one can assume that the proportion of
northerners from the maritime states of Mew York and
Massachusetts would be greater because of the port.
Foreign-Born Migrants. The figures given in the
above section refer to the native-born population. However,
the foreign immigrants formed a sizeable portion of the
population between 1850 and 1900. Because of San
Francisco's position as the port of entry into California,
this city received the tide of immigrants. What labor
became available in California, first became available in
San Francisco. The following figures enumerate the actual
numbers immigrating from foreign countries into California.
No figures are available for the period 1850-70.
1870-1880 ....... 110,200
1880-1890 ....... 118,400
1890-1900 ....... 65,400
1900-1910 ....... 297,600 u
The foreign-born population of California in 1850
stood at 23.5 per cent. Such a figure is undoubtedly too
low for San Francisco, as this was the chief port of entry
at that time. By 1860, 38.6 per cent of California's
population was foreign-born.^-* Therefore, during that
^^Thompson, o£. cit., Table III-4, p. 25.
15Ibid., p. 68.
134
particular decade, foreign arrivals accounted for approxi
mately 35 per cent of the increase. It was not until 1880,
and after, that internal migration out-stripped foreign
immigrat ion.
The most well-known foreign immigrant group in San
Francisco's history has been the Chinese. There were
virtually none of these people in the state in 1850.
However, after the discovery of gold, Chinese immigrated
into San Francisco and the mining areas of the state very
rapidly. The totals for the Chinese population for the
state are:
1850 ............... 777
1860 ........... 35,294
1870 ........... 48,995
1880 ........... 73,888 16
After 1880 the Chinese declined steadily in numbers.
Numerically, their high point was reached in 1880. Further
more, between 1860-80 they represented 25 per cent of all
the foreign-born. As a group they reached the highest
proportion of the population in I860. About one person in
ten was Chinese. Out of the total population, the follow
ing percentages illustrate the proportion of Chinese in
16Ibid., Table VII-3, p. 70.
135
the state during this period.
1850 ..............--
1860 ........... 9.2 per cent
1870 ........... 8.6 " " 17
1880 ........... 7.5 " " L/
Figures which represent the percentage of Chinese living
within the San Francisco Bay area illustrate an interesting
trend. These figures are:
1860 ........... 8.A per cent
1870 ........... 32.3
1880 ........... 39.6
1890 ........... 44.8
1900 ........... 40.4
1910............ 48.0
18
With the exception of one decade, the Chinese have become
increasingly urbanized within the San Francisco area.
Mexican nationals constituted only a small percent
age of the total California population between 1850-1900.
Persons born in Mexico represented about 30 per cent of all
foreign-born in 1850. This percentage fell to 2 per cent
by 1900.19
Unfortunately, figures are not available on the
foreign-born European nationals as a per cent of the total
^Commonwealth club of California, o£. cit.,
Table 55, p. 139.
^Thompson, oj>. cit. . Table VII-6, p. 75
19Ibid., p. 72.
136
California population for the years 1850-1900, as in the
case of the Chinese. This is because the birthplace of
the white population is not enumerated separately from the
20
general population prior to 1900. European immigrants,
however, have always constituted the biggest element in
the foreign-born population.
The British Isles furnished the greatest numbers.
The following figures are percentages of foreign-born from
the United Kingdom excluding northern Ireland.
1850 ...........
1860 ...........
1870 ......... 12
1880 11
1890 ........... 13
1900 ........... 13
19 per cent
12
21
The next table enumerates the Irish. Northern
Ireland is included.
1850 11 per cent
1860 ........... 23
1870 ........... 26
1880 22
1890 ........... 17
1900 ........... 12
22
By 1870 the Irish were the dominant group of foreign-born
whites in the San Francisco Bay area. They were also con
centrated in other northern California towns although in a
^Commonwealth club of California, oj>. cit., p. 138.
^Thompson, o£. cit., Table VII-3, p. 70. ^Ibid.
137
lesser degree. However, the Irish were much less dominant
in the rural areas, where the British held first place.
Those persons coming from Germany have also been
an important group as the following figures testify.
1850 ........... 14 per cent
1860 ........... 14 1 1
1870 ........... 14 " "
1880 15 1 1
1890 17 " "
1900 ........... 20 " " 23
By 1900 the Germans had displaced the Irish as the most
important foreign-born group in all of the northern areas
of the state.
The French from a high point of the foreign-born
of 7 per cent in 1850 steadily declined with each decade.
Canadians and Scandinavians were present but in smaller
numbers. Despite the obvious Italian influence in San
Francisco at the present time, very few of these people
came before 1900.
Sex Composition. As one might expect of a pioneer
area, especially one which was oriented toward mining,
there was a high proportion of males in the population.
Such a situation would distort the birth rate for the
23Ibid.
138
population as a whole, for many of the men were unable to
marry because of the lack of women. Therefore, the natural
increase of population was slowed down. The following show
the ratio of females per 100 males in California. Of
course, it should be realized that the figures would not
be as extreme for San Francisco, because there was a higher
proportion of women there.
1850 ....... 8 24
1880 ....... 70
1900 ....... 81
One factor which had tended to make for greater equality
in the sex ratio between 1850 and 1900, was the increasing
importance of native-born Californians in the population.
Furthermore, the in-migrants began to show a more balanced
ratio as time progressed.
Age-Composition. Not only did California show an
extremely abnormal sex ratio during the first fifty years
of its tremendous growth, it also showed an abnormal age-
composition. For example, in 1850, 51 per cent of Califor
nia's population was in the 20-29 age category compared
with the national percentage of 18 per cent. In the 30-39
24Davis McEntire, The Labor Force in California,
(Los Angeles: University of California Press, 1952), p. 25.
139
age group California had 25 per cent compared to the
2 S
national average of 12 per cent. J As one might imagine,
those persons under 10 or above 50 were far below the
national averages. By 1860 these extremes had begun to
modify themselves. The 30-39 age group was now swollen,
because the 20-29 age group had moved up. The 20-29 age
group was still high but only three-fifths as high as in
1850. Perhaps the only surprising thing about this census
of 1860 is that the proportion of children under 4 years
of age had grown to 11.3 per cent as compared to the
national average of 15.4 per cent which is not unusual.
However, in 1850 only 4.4 per cent of California's popula
tion was in the 0-9 age group. The age groups 5-19
represented only one-half of the national average.26
Eventually the age abnormalities have worked
themselves out. Nevertheless, by 1900 the state still had
a substantially smaller proportion of people under 20, and
it had a larger proportion of people over 30 than the
United States as a whole.
The composition of California's population during
^Thompson, oja. cit. , p. 55.
140
t
the second half of the nineteenth century was determined
by the gold rush. It attracted young single men who came
to seek their fortune.
Conclusion
Immigration into California during its early
history illustrates the importance of a port in relation
to economic development. The oceans of the world provided
the main highway to California. Therefore, the Golden
Gate was the most important entry point into California,
and San Francisco thrived because of its port function.
The origins of the immigrants reflect the influence of
transport as well. The port of New York had become the
chief American port and ships sailing from the United
States'east coast to California left from there. This
factor was undoubtedly instrumental in making New York
the chief supplier of native-born immigrants to California.
Massachusetts continually held a high place as a supplier
of people. Again, the fact that Boston was an important
commerc iai port from which ships sailed for California
may account for this. Of course, Missouri held a high
place as well, a fact which cannot be attributed to the
influence of a port.
141
Foreign immigration into California reflects the
influence of the sea. Naturally, the Chinese used the
ocean highway. The British isles furnished large numbers.
England was the chief maritime nation after the American
Civil War. From England radiated a myriad of shipping
connections to the rest of the world, making it convenient
for people from the British isles to emigrate.
Before the coming of the railroads, California's
chief connection with the world was the sea, an important
factor influencing its future destiny.
III. CHARACTERISTICS OF LOS ANGELES’ PERIOD OF
GROWTH 1880-1910
Economic Factors
In the case of San Francisco, the function played
by its port in stimulating urban growth is obvious to the
student of urban economics. In contrast, Los Angeles was
not so stimulated. Here one finds the situation of a city
receiving the growth impetus from factors other than a
port or from the functions generated by being an entrepot.
The first of the various waves of economic activity
to make an imprint on Los Angeles was the demand for cattle
created by the gold rush to the north. Just before 1870,
142
the first artesian wells were being brought In. Thus, a
new agricultural Industry arose centering around citrus
fruit, nuts, and grapes for wine making. A decade after
the artesian wells, a rail connection was secured to the
east. Thus Southern California fruit could find an eastern
market. Another decade saw the beginnings of the oil
industry. Each of the above industries was, more or less,
independent of the port at San Pedro. Thus, Los Angeles
was able to start the growth process without the aid of
a port.
However, the Angelenos realized the value of a
port. As early as 1869 Phineas T. Banning, with other
promoters, obtained the services of the Army Corps of
Engineers in making a survey of the harbor at San Pedro.
As a result, Congress appropriated $200,000 to straighten
and deepen Wilmington Creek and to remove the shoal at its
entrance. Consequently, small coastwise vessels could
be accommodated. The same backers for a port had obtained
27
12 small appropriations for the port by 1892. However, as
2?Glenn Chesney Quiett, TheyBuilt the West (New
York: D. Appleton-Century Company), p. 287-8.
Quiett says,
But the prospect of making a really great port for
Los Angeles was not bright, and certainly at this
time no one in the harbor cities of San Francisco or
San Diego would have considered it seriously. The
sea-going aspirations of Los Angeles, Queen of the
Cow Counties, was a joke.28
However, a harbor was soon to come. In fact it was
desperately needed if Los Angeles was to grow into a
metropolis.
As stated previously, during the gold rush cattle
became important to the little town of Los Angeles. Many
head were shipped to the northern mining areas. There was
also a little local mining being carried on, but it
acquired no importance.
From 1875 to 1881 there was a depression in Los
Angeles. Dry years ruined the sheep industry. There was
overproduction in other fields. Freight rates were high,
and there was a poor market for what products there were
to sell. One writer states, "The failure of the Temple-
Workman Bank brought the country to the verge of
bankruptcy.
28Ibid., p. 288.
2^J. M. Guinn, A History of California (Los Angeles
Historic Record Company, 1907), p. 301.
144
In 1881 the Southern Pacific Railroad was completed
from east to west. This provided an outlet for Southern
California products in the mining regions of Arizona and
New Mexico. Immigrants arrived, the price of land advanced,
and there was recovery from the depression. The reasons
behind the 1887 boom include: The completion of competing
railroads and local railroad building, the high price of
southern California products, an easy money market, and
high wages. There began a great immigration because of
a better climate, greater rewards for labor, and large
profits to be made from real estate. Then the professional
boomers arrived from other western cities. Guinn says,
"These boomers came here not to build up the country, but
to make money, honestly if they could not make it any other
way. It is needless to say they made it the other way."3®
Railroad promotion was very important in the early
years. The promotion centered around sending lecturers
and agents to the East and to Europe. Excursion parties
bringing prospective colonists were organized. There were
emigrant trains. McWilliams says,
30Ibid., p. 302.
145
At one time one hundred special emigrant cars were
in use on the Southern Pacific.31
The objective of the railroads was to sell the large tracts
of lands which had been granted to them and also to
populate the new areas as a way to create future business.
In the spring of 1886 a rate war broke out between the
Santa Fe Railroad Company, completed eastward in 1885, and
the Southern Pacific Railroad Company. Tickets from
Missouri River points to Los Angeles varied from $1 to
$15.32
Subdivisions began around the older towns. Later
completely new towns were laid out. In March, Aprilr and
May of 1887 thirteen town sites were laid out along the
Santa Fe right-of-way. One hundred towns were laid out
between 1884 and 1888. One agent sold 3,000 lots. Guinn
states, "So sudden and so great an inflation of land values
was perhaps never equaled in the world's history."33
Recorded transactions during the first three months of
1888 exceeded $20,000,000.
^Carey McWilliams, Southern California Country
(New York: Duell, Sloan, and Pearce, 1946), p. 127.
-^Guinn, o£. cit., p. 302.
3^Ibid., p. 305.
146
The area was hit by a depression in 1888. However,
a building boom in 1888-1889 improved conditions. The
reasons behind the boom were that many people had invested
in land, and in order to obtain a return, a further
investment in buildings was necessary.
In 1892 Doheny and Canon struck oil with a pick and
shovel. A wildcat boom developed. However, most of the
profits of promoters came from selling stock. Santa Monica
Boulevard became an oil worker's shacktown. By June of
1900 there were 1300 oil wells in the city limits. The
boom^ended in 1901, when the price dropped drastically.
In the early 1900's H. E. Huntington bought a
streetcar line in Los Angeles and commenced to construct
a huge interurban electrical streetcar network. Between
1900 and 1915 there was an expansion from 601 road miles
to 1,000 road miles within the city and its vicinity. One
by-product of this construction was the advancement of
real estate values due to improved transportation. The
Pacific Electric system has been called the greatest of
its kind in the world.
Another factor in the economic growth of Los
Angeles between 1880 and 1910 is that it was the center of
an expanding agricultural area. Although the raising of
147
both cattle and sheep was tried, both industries were
ruined by droughts. In 1868 the first artesian wells
appeared, and the fruit and nut industries began to grow.
For example, wine production increased from 1,300,000 to
14,000,000 gallons between 1875 and 1889."^ The citrus
industry also expanded rapidly. By 1880 there were
1,250,000 citrus trees. This type of agricultural produc
tion was benefited by the mild climate, good soil, and
the subterranean waters which provided moisture.
Tourism became very important to Southern California.
Between 1900 and 1920 Los Angeles was primarily a tourist
town. Thousands of tourists visted Los Angeles in 1901.
As a result, the construction industry was greatly
stimulated.
Besides the publicity given Los Angeles by the
railroads, a great deal of publicity had been given the
area by visitors, who, upon returning to their homes, wrote
glowing accounts of the country. In the 1870's a book was
written by Charles Nordhoff which set forth the benefits
of the mild climate of the area. Helen Hunt Jackson and
other writers did much to publicize the area, the missions
•^McWilliams, o£. cit.. p. 117.
148
in particular.
After much quarreling among various factions, a
federal appropriation was obtained to build a harbor at
San Pedro. Work was begun in the early 1890's. Morrow
Mayo stated, "It (the harbor) has probably done more than
anything else to make Los Angeles the chief metropolis of
California,"35 which is true to a large extent. It took
much backing from many groups in order to finally get
Congress to appropriate the money. One of the real leaders
was Leland Stanford, who went to Washington to campaign
for the appropriation. The newspapers, business groups,
banking, and the Chamber of Commerce were all very active.
Later the completion of the Panama Canal in 1914 brought
greater use for the Los Angeles Harbor. Hill says, "For
the first ten years following the completion of the Panama
Canal total tonnage (tonnage moved into and out of the
Q fi
harbor) had increased 1180 per cent."
Population Changes
Changing Totals. The population in and around
-^Morrow Mayo, Los Angeles (New York: Alfred A.
Knopf Company, 1932), p. 127.
36Laurance L. Hill, La Reina (Los Angeles: Security
Trust and Savings Bank, 1929), p. 137.
149
Los Angeles was negligible until the Boom of the 1880's.
Below are the population totals for both Los Angeles and
Orange Counties. Orange County was included in these
totals because until 1889 Los Angeles County included
Orange County as well.
1860 ........... 11,333
1870 ........... 15,309
1880 ........... 33,381
1890 ........... 115,043
1900 ........... 189,994
1910 ........... 538,567
The real estate ballyhoo and the railroad promotion
of the 80fs was responsible for the fantastic increase
between 1880-90. The oil boom, interurban railroad con
struction, an expanding agricultural industry, and tourism
were responsible for subsequent decades. Construction on
homes and businesses provided further stimulus. The
following figures represent the percentage increases for
the same periods in Los Angeles growth.
1860-70 35 per cent
1870-80 118 " "
1880-90 245 " "
1890-1900 .... 65 " ' '
1900-1910 .... 184 "
->7
Thompson, o£. cit., Table 1, p. 333.
38Ibid., Table 2, p. 334.
150
Migration. Much that has been stated earlier on
migration is as pertinent in the case of Los Angeles as in
the case of San Francisco. The prospect of making money
fast drew people to Los Angeles as surely as it did to
San Francisco. Real estate promotion was one of the big
incentives. Many professional boomers and promoters came
to cash in on quick profits. Southern California was one
of the last frontiers. Publicity about its mild climate
induced many to migrate.
In regard to the origin of the migrants coming
into Los Angeles between 1880 and 1910, the primary differ
ence is in regard to the importance of the native-born
American in contrast to the foreign immigrant. As far as
the Cates of origin of the native-born, the question is
whether there had been a shift in origin of the migrants.
A glance, at a few pertinent tables, would suggest that the
phenomenal growth of the southern counties after 1880 and
before 1910 did not disturb the trends significantly.
During these years, California itself supplied approximately
58 per cent of the native increase. However, in 1910 there
was a drop to 50 per cent supplied by the state. Between
1880 and 1890, the decade of the greatest percentage
increase in population for Los Angeles, there was less than
151
a one half per cent change in California's relative
position. Only during 1900-10, the second decade in
importance in Los Angeles' growth, did California's con
tribution drop, at which time it stood at 51 per cent.39
Of course, the relatively small aggregates during
these early years partially explains this. New York held
second place in supplying the native-born to California
from 1860 until 1910, when it was displaced by Illinois.
Illinois had displaced Missouri's third rank in 1890. Ohio
held either fourth or fifth place from the very early years
through 1910. When Los Angeles started to boom, Massachu
setts was beginning to lose its high ranking place and by
1910 was almost out of the p i c t u r e . 4 ® The thing to
realize is that despite this great growth of California's
population between 1880 and 1910, the relative position of
the other states, as contributors was changed very little,
perhaps it could be concluded that Los Angeles did not
appeal to any other group of people other than those who
had become influenced by the rush to the mines in "49.
One characteristic of the Los Angeles area is that
39
Commonwealth Club of California, o£. cit.,
Table 27, p. 91-2.
40Ibld.
152
it has attracted a much smaller portion of the foreign-born
than San Francisco has. Of course, the port of San
Francisco undoubtedly contributed to this situation. In
1870 the Mexicans were the dominant foreign-born group in
the south. However, percentagewise they dropped below
sixth place by 1900. The Irish were never a dominant
group in the southern counties. The British and Germans
were the dominant group of foreign-born with the Canadians
not far behind. At least they held this position in 1900.
By 1910 the Mexicans had again become the dominant foreign-
born group.^ Undoubtedly, another reason for fewer foreign
immigrants is the fact that with the completion of the
Southern Pacific and the Santa Fe railroads prior to the
A
1890's the majority of migrants came to California from
the eastern states. The influence of the port of Los
Angeles was negligible on the demographic character of
Southern California's population.
Sex Composition. The high proportion of males,
which was so characteristic of the northern part of the
state after the Gold Rush, was not duplicated by Southern
California. However, even here the sex ratio was very high.
^Thompson, oj>. cit. , p. 73-74.
153
The sex ratio is the number of males to every one-
hundred females. The normal sex ratio is 100. However,
at the birth of a cohort the ratio is 105. A cohort is a
demographic measurement which includes all of the persons
born within a specific year.
For San Francisco the sex ratio ran as follows:
1850 ........... 382
1860 ........... 171
1870 ............. H6
1880 ........... 134
The sex ratios for the Los Angeles area during its great
growth era were
1880 ........... 124
1890 ........... 117
1900 ........... 104 / o
1910............. 106
Between 1900-10, a period in which the Los Angeles area
experienced a growth in population of 184 per cent, the sex
ratio was normal. Certainly it shows that a different type
of immigrant may have been coming to Los Angeles as
compared to San Francisco. However, as was mentioned
before, there was little difference in regard to the origin
of the native-born population between the northern
42Ibid., Table 5, p. 33G. 43Ibid.
154
and southern areas. It would seem that the logical place
to look would be to the foreign-born population. In the
case of San Francisco, many Chinese coolies came into the
northern part of the state. A relatively small number of
Chinese women accompanied this migration. Furthermore,
many of these Chinese eventually returned to China. It
could be assumed as well that perhaps a much higher pro
portion of European immigrants were males than was true of
the native-born population. Since San Francisco got the
bulk of these people, the disproportionality could be
accounted for by this.
Age-Composition. In the matter of age-composition,
much of what can be said regarding its pattern is similar
to that for sex composition. In short, the abnormalities,
a common feature of the state between 1850 and 1880, had
begun to work themselves out by the end of the century.
Data for the state as a whole is easy to obtain. However,
age-data for Los Angeles County for the years 1880-1910
seem to be nonexistent.
Certain deductions can be drawn from previous
findings. In the first place, because the sex ratio for
Los Angeles was normal at the turn of the century, it can
certainly be assumed that Los Angeles had a higher
155
proportion of children than San Francisco. Furthermore,
the data for the entire state shows a higher proportion of
children for the period 1880-1910, as compared with 1850-
1880. Also, the data for the state shows a higher propor
tion of people over fifty for the period 1880-1910, as
compared with the period 1850-1880.
One question which needs answering is the actual
proportion of retired people who were attracted to the
Los Angeles area between 1880 and 1910. California's mild
climate was advertised over the entire nation by the Los
Angeles promoters. Tourism began to develop in 1900. This
was an inducement for older people to come to Southern
California. Undoubtedly, this date was the beginning of
the movement of the retired to the Los Angeles area.
IV. CONCLUDING REMARKS
The most significant population change between
1880-1910 has been the relative shift of California's
population from the northern to the southern region of the
state. In 1880 the City of San Francisco had over a
quarter of a million people. In contrast Los Angeles had
33,000. Between 1880 and 1890 Los Angeles showed a gain
of about 80,000. San Francisco gained about 65,000.
156
In 1910 the County of Los Angeles topped the County of
San Francisco by about 80,000. However, in that decade
the San Francisco Bay area still led the Los Angeles area
by approximately 200,000.44 gy 1920 the two areas were
virtually equal in population. The County of Los Angeles,
however, was far ahead of the County of San Francisco in
numbers.
Another interesting difference between the two
cities is that in 1900, 75 per cent of the people living
in the San Francisco Bay area lived within the central
cities of either Oakland or San Francisco. Los Angeles,
in the same year, had only 54 per cent of its population
within the central city.45 Thus it is seen that urban
development in Los Angeles tended to be dispersed over a
much wider area. The population density was much smaller
within the City of Los Angeles.
San Francisco had the initial advantage in that a
large hinterland area existed to be developed. The loca
tion was convenient for world trade, and there was a
natural harbor. Los Angeles lacked these advantages. Its
harbor was poor, and only a small hinterland area existed.
44xbid., Table 1, p. 333. 45Ibid-» P* 38-39.
157
However, Los Angeles possessed one feature which stimulated
both population migration and economic growth. This was
the oil industry.
For development, Los Angeles needed the promotional
activity created by the railroads, a zealous Chamber of
Commerce, and the ballyhoo made by real estate promoters
and enthusiastic tourists. San Francisco, of course, had
less of this type of promotion. The influx of both new
settlers and tourists created and sustained building pro
grams, service industries, and tourist services.
The pattern of development for Los Angeles began
with the response of the southern California area to the
needs of the mining areas to the north, the raising of
cattle and sheep are the best examples. The port at Los
Angeles did not play a very significant role in the
development of the city until after 1900. The coming of
the railroad provided a means whereby fruit crops could be
moved to eastern markets. Specialization in such crops
would have been impossible without the railroads, for
ocean transport was an impractical way to transport fruit
in that era. The importance of the railroad for the south
land is another example of the vital role transportation
performs in economic development. Until the appearance of
158
the petroleum industry, the natural resource base in and
around Los Angeles provided little that could have been
marketed on a large scale by ocean transport.
San Francisco and Los Angeles have highly contrast
ing backgrounds. However, contrasts are colorful. These
contrasts enrich California, historically and otherwise.
San Francisco did not rely on the natural resources of its
immediate region to achieve greatness. San Francisco was
built upon trade and eventually manufacturing. Up until
the last generation, it was the commercial center of the
Far West.
Los Angeles prospered by developing the natural
resources of the southern counties. Examples include a
warn climate which enabled the development of the fruit
and the tourist industries. Oil was another important
natural resource. Manufacturing played an insignificant
role in the development of Los Angeles until World War II.
Each city has created a different mix of industries.
The port at San Francisco was critical in the development
of San Francisco's economic functions. The port at Los
Angeles did not assume great significance for the city
until its improvement by the federal government and by the
opening of the Panama Canal in 1914.
CHAPTER V
AN EVALUATION OF THE SEAPORT AS GENERATOR AND
PROGENITOR OF ECONOMIC DEVELOPMENT AND
SPECIALIZATION
I. THE ECONOMIC BASE THEORY AS A
METHOD OF URBAN ANALYSIS
The Development of Base Theory
The economic base theory is a method to give a
descriptive analysis to the economic profile of a city.
It is a model used to explain urban or regional growth.
By the application of this theory, certain economic func
tions in the community, such as service activities, total
employment, and total population can be estimated. This
is achieved by the use of ratios.
Often a loose definition of the economic base is
applied. In this case, all of a community's economic
activities are included. Within this definition the eco
nomic base is regarded as being all of the money-making
activities of a city. However, in regarding economic base
theory per se, a more precise and at the same time a more
159
160
limiting definition is employed. According to the limited
definition, the economic base consists of those economic
functions which export goods or services to areas outside
the immediate city. These businesses earn dollars for the
community. In turn, the community may import goods from
outside and pay for them with export-earned dollars. These
activities must be delineated from the producers of goods
and services for the local community. Therefore, those
industries which respond to the demand created by the
immediate region, nation, or the world constitute the
ec onomic base.
The awareness of this distinction is not new. As
mentioned before in this paper, Sombart was the first to
make the distinction between city founders (the economic
base) and city fillers (the service industries). In 1928,
an economic survey of New York City and its environs made
a division between export-centered industries and service
industries. In this study, industries were categorized
into being either primary or auxiliary.
To Homer Hoyt, in 1936, goes the honor of develop
ing a theory that has usefulness as a tool in not only
analyzing the economy of a community but also in predicting
the growth of the city. Hoyt developed a four-stage
161
technique.
1. Calculation of total basic employment in the
community.
2. Estimation of the proportion of basic employ
ment to service employment. He found this
to be a 1:1 ratio.
3. Estimation of the future trend in each segment
of the base.
4. Calculation of total employment and total
future trends in basic employment.
Hoyt listed types of urban base activity. These include:
1. Manufacturing.
2. Trade.
3. Extractive industries.
4. Governmental activity.
5. Educational institutions.
6. Resort centers.
9
7. Retirement centers.
Other thinkers added to the work done by Hoyt.
Victor Roterus designed a means whereby local employment
statistics are correlated to the national level. A
^-Richard B. Andrews, "Mechanics of The Urban
Economic Base: Historical Development of the Base Concept,"
Land Economics, Vol. 29, May 1953, pp. 161-167.
^Arthur Weimer and Homer Hoyt, Principles of Urban
Real Estate (New York: The Ronald Press Company, 1939),
pp. 49-52.
162
projection is then made of movements in local employment
in relation to national employment. John Alexander made
another addition to the theory by giving a better identifi
cation to base and service industries. In turn, Jtatcliff
showed more explicitly how the economic base influences
not only the total economy, but the political, social, and
institutional structure of the city as well.^
The Base Ratios
Much of the value of the base to service ratio,
especially as a predictive tool, rests on the assumption
of a constancy in the ratio. The number assigned arbitrar
ily to the economic base is one. However, the service
number may and probably will vary. Originally it was
assumed to be a 1:1 ratio. However, empirical research
has shown it exists between 1:1 and 1:2. The reason for
the above difference can be attributed to a variety of
economic bases.
Furthermore, temporary variance in business condi
tions between geographical locations may be another factor.
^Richard U. Ratcliff, Urban Land Economics (New
York: McGraw-Hill Book Company, Inc., 1949), pp. 42-59.
163
A further consideration is the city's age. The older the
city, the more likely there is to be a higher service
factor in relation to base activities. One ratio has shown
great consistency. It is the ratio of total community
employment to the total population in the city. Because
of census data, this information is relatively easy to
obtain. In this country the ratio is 1:2. Investigation
has revealed the following set of ratios.
Economic Base : Service Activities :: 1:2
Economic Base : Total Employment :: 1:3
Total Employment : Total Population :: 1:2
Economic Base : Total Population :: 1:6 ^
Certain classifications may be included under the
economic base. Among the exports we may have export of
goods, services, or capital. These fall into two broad
categories.
Class A, Economic Base Activities.
1. Movement of goods to the purchaser.
2. Movement of services to the purchaser.
^Richard B. Andrews, "Mechanics of The Urban Eco
nomic Base: The Concept of Base Ratios," in The Technique
of Urban Economic Analysis, Ralph Pfouts (ed.) (West
Trenton, New Jersey: Chandler Davis Publishing Company,
1960), p. 143.
164
3. Movement of capital to the investor; a return
is earned by the community in the form of
interest, dividends, and mortgage interest
on real estate.
Class B, Economic Base Activities
1. Movement of the consumer to the goods; pur
chasers come to the city in order to visit
retail stores.
2. Movement of the consumer to the service; the
purchasers enter the city and use a service
while they are there.
3. Movement of the consumer to capital; banks and
other financial intermediaries are the prime
examples. People from outside the community
enter the city in order to use these
services.5
Homer Hoyt used employment figures for establishing
the base ratio. However, other units of measure have been
used. The various units including employment are:
1. Employment, this unit has convenience because
information is available, historical
comparisons can be made, and it is
representative of family units.
2. Payrolls, this has value because the degree of
the standard of living can be determined.
Moreover, the median income of employees in
basic industries is important. Service
industries can be affected greatly.
^Richard B. Andrews, "Mechanics of the Urban
Economic Base: A Classification of Base Types," Land
Economics, Vol. 29, November 1953, pp. 343-349.
165
3. and 4. Value Added and Value of Production,
the significance of using these figures is
that many firms create large value added,
but use relatively few employees. This
measure brings these industries to the
economic analyst's attention, industries
that could be neglected with the use of
the other measures.
5. Physical Production, this has never been used,
it is doubted whether it is useful for
anything other than manufacturing.
6. Community Income and Expenditure, this approach
would be very satisfactory, for it would give
a good profile of the community. However,
for large cities the data is extremely diffi
cult to obtain. Consequently, technical
limitations render it useless.6
In economic base analysis, economic activity is
classified as either "basic" or "service." The basic
industries produce and sell outside of the community, earn
ing export dollars. The service industries cater to the
needs of the city. These industries are pulled, in the
beginning, by the demands created by the workers previously
attracted by the base industries. Certainly, the local
government and the school system constitute a service.
Retail merchandising looms so large as a service industry
that some would mistake it as being a part of the economic
^Richard B. Andrews, "Mechanics of The Urban
Economic Base: The Problem of Base Measurement," Land
Economics, Vol. 30, February 1954, pp. 52-60.
166
base. Personal services, such as barber shops, plus the
hotel and restaurant industry are included. As a city
grows older, it has been found that the service sector
becomes relatively more important. The service businesses
cater, not only to those in the base sector, but to the
total population, including both workers of the base and
service sectors.
Certain industries may be engaged in both base and
service activities. A bank may make loans to individuals
within the city, a service activity, or it may make loans
outside the community, a basic activity. In this case
interest will be earned on capital exported. Retailing
is a good example. Many people enter the city in order to
buy goods which are not available in small towns. An
example of a large industry is an auto assembly plant.
Most of the cars will be shipped outside of the area.
Nevertheless, some of the cars will be sold in the
immediate vicinity. City sales of these cars represent a
service activity.
Industries are linked to one another. Urban
development may be stimulated by urging industries, outside
the community, which have a linkage to industries within
the city, to relocate nearby. Alfred Marshall's concept
167
of external economies enters here. Also Hirschman, an
economic developmentalist, stresses this point. Even
beyond direct linkage there will be an influence exerted
by a new industry that is indirect. Such a situation
results from external economies and complementarities.
Hirschman states,
While satellite industries are almost certain to
be established once the master industry is in place,
the establishment of industry W also results in
stimuli toward the setting up of nonsatellite indus
tries. In these cases, the strength of the stimulus
is infinitely weaker, but the stake is far greater.?
The various types of industrial linkages are:
1. Vertically linked: Industries engaged in
successive processes before completion of
the final product.
2. Laterally linked: Industries that produce
either parts or accessories for an assembly
line industry.
3. Divergent linkage: This type of linkage is
the sharing of a common local process as a
source of raw materials.
4. Diagonal linkage: These industries serve
other industries in the area.
Limitations of The Economic Base Theory
There are numerous problems involved in making a
^Albert 0. Hirschman, The Strategy of Economic
Development (New Haven, Connecticut: Yale University
Press, 1958), p. 102.
168
base study. First, there is the definitional problem. For
instance, as the boundary of a region expands, the exports
will include a relatively smaller portion of the economic
activities. Therefore, how large an area do you include?
If the study concerns one city, the city itself and its
suburbs must be included. A large metropolis must embrace
the central city, satellite cities, and suburbs. As stated
before, determining income by the base approach is hazard
ous, because of the difficulty of obtaining data for large
cities. However, income is the most revealing of all the
measures. This raises the problem of the type of measure
to be used. Employment and population figures can be
obtained and are valuable. Other measures, mentioned
previously, are jobs, payrolls, value added, physical
production, and community income and expenditure patterns.
However, each measure is handicapped by some disadvantage.
The lack of a dynamic approach is a fault with
the base studies. As with so many economic models this
approach is static. A complete picture may be given at
one moment of time, but that is all. Furthermore, there
have been no continuing economic base studies over time.
However, repeated studies would give a much better analysis.
In this way, a more dynamic model would emerge. Another
169
serious fault, stemming from this lack of dynamics, is
the failure of economic base analysis to predict changes
in the base itself. Of course, it has great value in
predicting changes in the service sector, once a change
has come about in the economic base.
Even more damaging is the fact that certain
statistical studies do not support the economic base theory.
Various studies have been made in order to test the valid
ity of economic base theory. One of them was done by
Pfouts and Curtis based upon a study by Gunnar Alexanders-
son using figures of comparison for 1940 and 1950.® One
of the critical factors in base studies is computing the
basic population. In computing this basic population,
Alexandersson had assumed that the employment within a
certain industry should approximate the average employment
in the industry in forty separate cities. Anything over
this average was regarded as being basic employment. Of
course, the method can be inaccurate in the sense that it
assumes any employment below the average constitutes a
service, whereas in practice it may be basic employment.
®Ralph W. Pfouts and Earle T. Curtis, ''Limitations
of The Economic Base Analysis," Pfouts, op. cit., pp. 308-
318.
170
Despite this, it is felt that the method is still valid for
comparing cities. Pfouts and Curtis correlated basic and
service cities to changes in population for the years 1940
and 1950.
By examining Table 5, it can be seen that the
correlation of per cent change in city serving employees
to per cent change in population for export cities is
significant. It is -.7219. This would support the base
theory. However, cities with a high service employment
show a coefficient of correlation of only .2020. This
figure represents no significance whatsoever. (Note Table
6.) The coefficient of correlation for all forty cities
q
is -.3618. Again there is no significance. By examining
the two tables, it can be seen that the export cities were
the highly industrialized cities of the north, along with
a few west coast cities. Most of the service cities are
located in the south. The heavily industrialized northern
cities have failed to keep abreast of the population
increases that could be expected by using the base ratio
approach. On the other hand, the more diversified cities
have grown faster than would have been expected.
^Pfouts and Curtis, oj>. cit., p. 310.
M
TABLE 5
CITIES WITH HIGH EXPORT EMPLOYMENT
Percentage Change Percentage
in City-Serving Change in Standard
Employees Population Metropolitan
1940-1950 1940-1950 Area Predominating Industries
-79.5 27.7 Lexington, Ky. Medical, Retail, Education, Construc
tion, Household
-51.9 78.2 Phoenix, Ariz. Wholesale, Retail, Construction
-33.9 66.1 San Jose, Calif. Food, Construction
-33.6 62.8 Mobile, Ala. Administration, Household, Transporta
tion (other than motor vehicles),
Nondurables
-29.9 45.0 Austin, Texas Education, Administration, Construc
tion, Household
-20.4 16.5 Racine, Wise. Machinery, Electrical mach., Fab.metal,
Primary metal
-19.7 54.9 Fresno, Calif. Retail, Wholesale, Construction
-19.2 15.9 Jackson, Mich. Motor vehicles
-10.3 32.4 Lansing, Mich. Motor vehicles, Education,
Administration
-10.0 49.6 Stockton, Calif. Retail, Administration ^
- 6.8 25.6 Saginaw, Mich. Motor vehicles, Primary metals
TABLE 5 (continued)3
Percentage Change
in City-Serving
Employees
1940-1950
percentage
Change in
Population
1940-1950
Standard
Metropolitan
Area
Predominating Industries
-6.8 17.7 Waterloo, Iowa Machinery, Food
-2.9 26.0 Little Rock, Ark. Railroads
-2.4 25.8 Rockford, 111. Machinery, Fab. metals
2.1 29.6 Madison, Wise. Education, Food
4.1 15.5 Topeka, Kansas Railroad, Medical, Food,
Administration
10.7 22.7 Evansville, Ind. Machinery, Food
11.6 -0.6 Altoona, Pa. Railroads
11.7 16.7 Springfield, Ohio Motor vehicles, Printing, Machinery
12.5 26.6 Kalamazoo, Mich. Nondurables, Chemicals
Coefficient of correlation for export cities . . ........... 1 = -.7219
aRalph Pfouts (ed.), The Technique of Urban Economic Analysis (West Trenton,
New Jersey: Chandler Davis Publishing Company, 1960), Table 1, p. 312; data compiled
from Gunnar Alexandersson, The Industrial Structure of American Cities (Lincoln, Nebraska:
University of Nebraska, 1956). Appendix 1. 172
TABLE 6
»
CITIES WITH HIGH CITY-SERVING EMPLOYMENT
Percentage Change Percentage
in City-Serving Change in Standard
Employees Population Metropolitan Predominating Industries
1940-1950 1940-1950 Area
222.8 26.7 Durham, N. C. Nondurable, Textile, Medical,
Education, Construction
103.3 21.5 Montgomery, Ala. Household, Administration,
87.6 17.5 Shreveport, La. Retail, Mining, Household,
Construction
82.7 32.5 Jackson, Miss. Households, Construction
60.0 15.5 Winston-Salem, N.C. Nondurable, Textiles, Households
55.9 14.4 Asheville, N. C. Medical, Retail, Households
51.3 6.7 Atlantic City, N.J. Hotels, Construction, Eating and
drinking places
49.6 36.1 Charleston, S. C. Transportation equipment, Household
44.7 28.4 Savannah, Ga. Nondurable, Railroad, Household
44.5 24.6 Lincoln, Neb. Retail, Education, Railroad,
Administrative
39.2 19.0 Raleigh, N. C. Administration, Education, Household
35.5 15.8 Springfield, Mo. Railroads, Retail, Wholesale
34.5 36.0 Columbia, S. C. Households, Textile, Construction,
Administration w
TABLE 6 (Continued)a
Percentage Change Percentage
in City-Serving Change in Standard
Employees Population Metropolitan Predominating Industries
1940-1950 1940-1950 Area
30.6 10.5 Lancaster, Pa. Textile, Durables, Electric mach.
26.8 11.4 Binghamton, N. Y. Nondurable, Machinery
23.5 11.5 Springfield, 111. Administrative, Machinery
23.3 23.1 Greenville, S. C. Textile
20.1 0.3 Sioux City, Iowa Food, Wholesale, Retail
15.9 39.3 Galveston, Tex. Transportation, (other than motor
vehicles)
14.4 13.9 York, Pa. Machinery, Fab. Metal
Coefficient of correlation .................... 1 = .2020
Coefficient of correlation for all forty cities .................. 1*- .3618
aIbid., Table 2, p. 313.
175
Of course, the above casts heavy doubt on the base
approach. To elucidate this further, it has been demon
strated that during the 1940-1950 decade, Standard Metro
politan Areas increased their population by 21.8 per cent.
However, northeastern cities increased only 10.3 per cent.
Southern cities increased their population by 35.6 per cent.
This is 50 per cent faster than the national average rate
of metropolitan population growth.^
One explanation for the above finding, and probably
the most valid, is that the economic base theory may be
correct, but that the base-service ratios are inconsistent.
If the ratios are incorrect, then the theory would have
limited predictive value. Another conclusion is that more
activities must be included in the base. As Pfouts says,
"Income generation within the community, imports, and
consumption (or savings) are important 'city builders' as
well as exports.The conclusion may be that exports
are only one of three variables that must be taken into
account.
^■^Donald J. Bogue, Population Growth in Standard
Metropolitan Areas 1900-1950 (Washington, D. C.: Housing
and Home Finance Agency, 1953), p. 25-6.
^Pfouts, o£. cit. , p. 304.
176
Despite the many drawbacks to the economic base
approach, the theory has validity as a descriptive approach
to the analysis of a community's economy, for It Is a
difficult job to evaluate all of a city's activities. By
delineating the export from the service sides of the
economy, a greater understanding can be gained of the com
munity's economic profile. Furthermore, some logical
framewrk is needed. The base approach is such a framework.
Moreover, much empirical research does support the economic
base theory. Even assuming that the ratios are not very
accurate, nevertheless, a rough projection may be made of
future population changes by using the base approach.
Finally, other means of economic analysis have limitations,
as well as the economic base theory.
A discussion of the economic base theory has been
included in this study on ports because a port's activities
constitute a part of the economic base. If we analyze a
port city with the economic base theory, we can delineate
the port functions which are basic and the economic
functions which are service activities. Moreover we will
be able to make a rough prediction on changes within the
economy of the port city, when a change takes place in
port activities.
177
Other Methods of Metropolitan Economic Analysis
Other than the economic base approach, input-output
models have been used. The economist, Leontief, developed
the input-output matrix. According to Tiebout there are
three frameworks within which the input-output techniques
may be used in regional analysis. They are:
1. Local impact studies.
2. Regional balance of payments studies.
3. Interregional flows studies.
In a sense, the impact studies are similar to the economic
base studies. The question is posed, that if a new indus
try were to settle in a certain region, what would be the
change in the level of economic activity for the area?
The other two approaches are strictly regional in character
and need no further elaboration here, since this paper is
concerned with cities per se.
Because of unsatisfactory results yielded by the
economic base theory a Keynesian approach has been
attempted. An effort has been made to construct a com
munity income multiplier. Again the problem, as stated
^Charles m. Tiebout, "Regional and Inter-regional
Input-Output Models: An Appraisal," Southern Economic
Journal, Vol. 24, October 1957, pp. 140-147.
178
before, Is the difficulty of collecting income data on the
local level. With this approach, a division in economic
activity is made similar to the base-service ratio. There
are the exogenous activities, activities all of which are
conditioned by forces outside of the community. The others
are called the endogenous activities. These are the
activities that are set by forces within the economic
13
system of the community. The primary reason for the use
of terms dissimilar to base terminology is an attempt to
avoid the idea that exports make up the only basic activity.
As with the economic base theory, a constant ratio must be
assumed between endogenous and exogenous activities. This
would be the community counterpart to the stability of the
consumption function. Unfortunately, there have been few
studies made using the income approach, consequently its
validity has not been established.
II. ECONOMIC FUNCTIONS ASSOCIATED WITH A PORT
Definition of a Port
According to Pirenne, the word port developed from
the Latin word portus. In the administrative terminology
1 3
Charles M. Tiebout, "The Community Income Multi
plier: A Case Study," Pfouts, 0£. cit. , pp. 342-345.
179
of the Roman Empire, it was an enclosed area that served
as a storehouse or transfer point for merchandise.^ It
may or may not have been a sea port. A distinguishing
feature of the port, in contrast to the fair, is that the
port was a permanent place of trade. The Latin term was
passed on to the middle ages. Pirenne says that during
the tenth century the word port had come to be synonymous
for the Latin words urbs and civitus in Anglo-Saxon
speech.^ Moreover, there was a similar derivation in old
Dutch. The word poort referred to a town.
During the middle ages, with the revival of trade,
the merchants tended to gather outside of cities in
colonies of their own. This new section of the city came
to be called the faubourg or 'outside burg.1 It was also
known as the novus burgus or 'new burg.' Pirenne states
that in the Netherlands and England the word to designate
the faubourg or novus burgus was portus. Lewis Mumford
gives a somewhat different version of the origin of the
word. According to him, the Latin word porta is equiva
lent to the English word portal. In turn porta or portal
14
Pirenne, 0£. cit. , p. 102.
15Ibid.
180
means the city gate."^ Webster1s New International
Dictionary, defines port as,
A place to which vessels may resort for purposes of
commerce, especially to discharge or receive their
cargoes .... It primarily and normally refers to
a haven or harbor, but may be used to denote any
place to or from which merchandise may be shipped,
as a mere landing place.
As the commercial class grew during the middle ages, it
tended to congregate about the city gate. The area outside
the city portal was the natural stopping place for merchants
and their goods. Here the goods could be set down, whereas
in the crowded medieval city such a thing would have been
difficult. Because the goods were deposited outside the
city, it was only natural for trade among these goods to
take place here.
As the term port developed, it has come to mean a
point for the transfer of goods between water and land
carriage. This is understandable when one realizes that
trade during the middle ages was dependent on water
transport. The term port came to mean the point of trans
shipment from water to land exclusively.
A confusion often exists between the terms harbor
^^Lewis Mumford, The City in History (New York:
Harcourt, Brace, and World, Inc., 1961), p. 305.
181
and port. Each has a distinct definition. Harbor is the
more general term. It is a shelter for ships from the
actions of waves and wind that is encountered upon the
high seas or is found at a roadstead. A roadstead is an
anchorage of partial protection. Many fine harbors exist.
Some are used, some are not. Many harbors are unused, as
one authority has stated, for numerous reasons, distance
from trade routes, difficulty of approach from the land
side, or the underdeveloped character of their hinterland,^
A port is something else. A port must be a harbor, but a
harbor need not be a port. To have a port a harbor must
exist, either artificial or natural, along with facilities
for the transfer of goods between land and water carriage.
Such facilities include berths where ships may tie up,
transit sheds for storage of goods, and transport accommo
dation for movement of goods away from or to the port.
Certain features of ports are very durable. These
include breakwaters, wharfs both piers and quays, transit
sheds, railroads, and roads. One writer has made an
interesting comment on this aspect of durability. Aitken
W. Morgan, Ports and Harbours (London:
Hutchinson's University Library, 1952), p. 47.
182
says,
Because of the great amount of capital required
in proportion to short-term use, they (transport
facilities) are generally constructed only by the
state or semi-public agencies aided by the state.
Once completed, however, transport facilities become
a part of the physical heritage of the area.18
The more developed the port, the greater application of
capital one finds in the development of the port. Moreover,
a greater number of services are offered to both the
shipping industry and to the shippers.
Port Service Functions, One of The Activities Within The
Economic Base
Maintenance of Harbor Facilities. In order to have
an efficient commercial port, maintenance is required. For
example, because of silting, dredging, operations are a
necessity. In the United States this is carried out by the
Army Corps of Engineers. This operation is a part of the
economic base of the port, even though its impact may be
slight, due to the relatively few men engaged in it. A
similar operation is the maintenance of buoys and naviga
tional lights such as lighthouses. Presently, these are
*-®Hugh G. J. Aitken, The State and Economic Growth
(New York: Social Science Research Council, 1959), p. 297.
183
maintained by the U. S. Coast Guard. Again, few men are
engaged in this. In the case of small ports, there may be
no permanent facility for this work.
Maintenance, on the land side of the port, involves
repair and painting of transit sheds, though it should be
stated that many ports neglect this. However, not to be
neglected are the repairs to roads and rail facilities.
Besides maintenance, port improvements would be a part of
the base, especially if these improvements took place over
a period of time. This is because the construction
industry is important as an employer of men. Consequently,
this would be significant as a part of the base.
Services rendered to shipping. Included in these
services is, first of all, pilotage offered to incoming
and outgoing vessels. Besides the actual pilots, there is
the pilot boat requiring both maintenance facilities and
a crew. Secondly, tug service must be available. Both
the size of the port and the tonnages of the ships handled
determine the size of the tug fleet. Federal services
include immigration, customs, and public health officials,
all features of the modern port. Among the local govern
mental responsibilities, one finds the maintenance of fire
fighting facilities, including both fire boats and land
184
equipment. Another small item in the base are foreign
consular officers. Facilities for providing fresh water to
ships are needed, although this is of such slight economic
importance it scarely deserves mentioning. Each one of the
above services to shipping, in itself, is relatively small,
compared to the total activities of the port. In the
aggregate, however, these services do assume an important
sector of port activities. As stated before, these
services are a part of the economic base of the port city.
There are numerous private services to shipping.
An important service is the ship chandling industry. Great
sums of money are spent in supplying ships; food is one of
the most important items. Stores for the maintenance of
vessels at sea must be loaded onto the ships as well. Shop6
specializing in nautical instruments are typical of the
larger ports. Small ports have difficulty in creating
enough business for this specialty. The same thing can be
said of the ship chandlers, for the ships will buy their
stores in one large port. The only items purchased in
small ports would be vegetables or fruit. The situation
is very disadvantageous for the small port. Because of
this habit of buying ship's supplies in the large ports,
these ports have developed large ship chandling houses.
185
Consequently, it is difficult for the small port to
establish this type of an industry.
An important private service is bunkering. It is
the sale of fuel oil to shipping. However, for any large
bunkering activity to take place, the price of the oil in
the particular port must be relatively cheap, because ships
will load bunkers for an entire voyage at one port. The
port chosen will be the one where the fuel is the cheapest.
A port providing this service needs oil docks. These docks
are associated with an oil company. In this case, the ship
may go directly to this dock in order to bunker. The
second method is the use of oil barges that can be moved
about the harbor by tugs. In this case, the barge is moved
to where the ship is moored, and provides fuel. Actually,
only a small number of employees are needed for bunkering
service. However, the importance to the economic base
would lie in the acquisition of dollars in the sale of the
oil. Numerous ports have taken advantage of large oil
reserves nearby and have sold large amounts of fuel oil to
vessels. Los Angeles is a case in point. Because of the
presence of large oil deposits and large refining capacity,
Los Angeles has offered a cheap bunkering service. Conse
quently, many ships stop at Los Angeles for fuel, even
186
though there may be no other reason to call at this port.
Another example, is Port-au-Prince, Trinidad. Again there
is the presence of large oil deposits plus some refining
capacity. As long as the cheap oil port is not too far
from the world's shipping lanes, it will be used as a source
of bunkers.
Services in cargo handling. The most important
item in this category is the longshore industry. In con
trast to the services named previously, this is one port
function requiring a large number of employees; although at
the present time this is in a state of transition resulting
from the impact of automation in cargo handling. In the
future ports will require smaller numbers of longshoremen
because of automation. Not only are large numbers of men
engaged in longshore work in the port cities, but within
the United States the wages earned by this type of labor
are high in relation to other laboring groups. As a result,
port cities can claim a high ratio of value-added to
product because of the presence of the longshore industry.
Thus this is an important segment of the port's economic
base. In addition, transportation services for cargo
handling require teamsters and railroad personnel. Not to
be forgotten for the above services, are the people in
187
management.
Harbor department personnel. The modern port is
governed by a governmental corporation termed an authority.
According to Fair, an authority is a, "Body established by
law to have specified powers including the right to act
with respect to a defined area of responsibility."^ The
functions delegated to port authorities vary so widely
between ports that it is irrelevant here to go into the
many possible phases of its activities. Some port authori
ties are broad enough as to include the supervision of
airports. The New York Port Authority has built and main
tains a system of tunnels and bridges. Some authorities
own wharfs and warehouses, then lease these to private
companies. Others do not own such facilities. Port
authorities do exercise many functions in common. These
include:
1. Port development, new construction included.
2. Rules for the operation of the port.
3. Contract approval in relation to the develop
ment and maintenance of facilities.
4. Review of rates and charges.
^Marvin L. Fair, Port Administration in The United
States (Cambridge, Maryland: Cornell Maritime Press, 1954)
p. 43.
188
20
5. Public relations activity.
Of course, the interest in the port authority in
this study is its existence as a part of the economic base
and its influence upon port development through promotional
activity. Obviously, both the size of the port and its
number of functions determine the size of the staff of the
harbor department. An example is the Los Angeles Port
Authority. It has a huge staff of 500 people. Not only
is it one of the world's largest authorities, but the
Authority also owns 100 per cent of the improved waterfront.
An example of a small port authority organization is the
Port of Brownsville, Texas, which has about 50 employees.
The operation of a port is a business in itself.
Thus we have a fourth category to be added to the economic
base of the port city. There is maintenance of harbor
facilities, services rendered to shipping, services
rendered in cargo handling, and now the administration of
the port.
III. THE INDUSTRIAL PORT
Ship Building and Ship Repair, An Exclusive Port Activity
Ship building and repair is an economic function
^Ibid. , p. 45 .
189
which could have been listed under services to shipping.
Facilities for ship repair are a part of all large ports.
Small companies engaged in this business have a slip or
dock where ships can come for repair. However, ships
requiring dry docking must go to a more extensive facility,
such as a shipyard. Ship repair facilities will be found
in both large and medium-sized ports. Their presence,
however, may not be apparent to the passerby. It is a
service which locates at a port because it must be near the
ships.
Closely followed by the ship repair facility is
the regular shipyard. Either a floating dry-dock or a
graving dock is a part of the facility. Perhaps two or
three drydocks are present. The regular shipyard is
equipped to handle extensive ship repairs. With any large
shipyard, ways will be present for the construction of new
ships. New ship construction is an important economic
activity. Some shipyards find regular employment at this
task.
Typically, the shipyard will be located in a section
of the port with deep water, where the value of land is
low compared to other port areas. The section of the port
specializing in transshipment of cargo will be the most
190
important commercial district on the waterfront. The
transshipment factor will force shipyards out if the two
are in conflict over a segment of waterfront. Morgan
comments on the decline of shipbuilding in Liverpool during
the nineteenth century, because of the greater productive
21
value of docks. Shipyards are a very important part of
the economic base of the port city. First, many men are
employed; second, the value of production is high. This
is especially true with new ship construction. Not only
does the payroll of the shipyard affect the economic life
of the city, but the type of men employed will affect the
sociological pattern of the community. Shipyards will be
found concentrated in commercial ports; however, it is
common for yards engaged in new ship tonnage to locate
away from the commercial port. Such examples are Newport
News Shipbuilding at Newport News, Virginia. Even more
notable are the British yards on the River Clyde in
Scotland. John Brown, the most famous builder located
there, has constructed many famous ships including the
Queens Elizabeth and Mary.
The shipyard engaging in repair work and new
^Morgan, o£. cit. , p. 136.
191
construction puts the port into the category of being an
industrialized port. Besides the actual shipyard, linkages
will exist with other industrial groups. The smaller the
shipyard the more linkages that will be present. The huge
shipyard might be comprehensive enough to include all
activities within its fold. Ships' engines are constructed
frequently by concerns other than the shipyard, concerns
which may be located at a distance from the port where the
shipyard is located. Besides the above, minor business
may be carried out by machine shops other than those in the
shipyard. With new ship construction, interior decorating
for passenger quarters, including the purchase of furniture,
may be undertaken by firms disconnected with either ship
building or the maritime industry. Ship repairing and
shipbuilding constitute an important industrial activity,
not only for a port but for the nation as a whole.
The Transshipment Factor, An Agglomerative Influence Upon
Industry
Petroleum refining. A very important industry
which seeks a port location is petroleum refining. Other
locational pulls are very important, items such as
orientation to the market or orientation to the source of
192
raw material. Some refineries have been located at inter
mediate points. However, for the majority of these firms
either the market or the location of oil reserves has been
the deciding factor in refinery location. In Europe
especially, but also in the United States, refineries have
sought sea port locations. This results from the need for
the importation of crude oil. Since the advent of the
super tanker the necessity of an adequate port is greater
than ever. Unfortunately for the small port the growing
size of super tankers is a disadvantage, for these ships
must call at large deep water ports. As a result, there
has been an enlargement of refineries at these ports. Con
sequently, small refineries at small ports have suffered a
relative decline in importance. In the future, a small
port will have difficulty in attracting refineries unless
it goes to the added expense, probably prohibitive, of
deepening channels and constructing special
terminals for these goliath tankers of the ocean.
Refineries are an extremely important base
industry. Despite the relatively few men employed at
refineries, compared to the large amounts of raw material
handled, these are large numbers as far as the community
is concerned. The payroll of the refinery is significant
193
and can keep a small city going. In addition, the "value
added" to the product by the refinery is very high.
Steel plants. The location of the steel industry
plants has been shifting more steadily to seaboard loca
tions. This trend has arisen because heavier reliance is
being placed on imported ores in the developed nations. A
deep-water port is essential in order to accommodate the
large ore-carriers of the present day. In addition to the
t
importation of ores, thought must be given to the exporta
tion of steel products. Therefore, a port location is
advantageous from this standpoint also. The most obvious
example of this type of location in the United States is
the great Sparrows Point steel plant at Baltimore, Maryland.
Foreign ores are used here. A large shipyard is also in
existence at this plant.
Power plants and smelters. Other industrial
activities also require a port location. In the past,
power plants needed a port resulting from the necessity of
importing coal for the plant. This was true of England,
where the coal was in the north and the population, along
with many power plants, was in the south. However, the
introduction of fuel oil has eclipsed this necessity.
Smelting is another industry oriented toward the port.
194
Within the United States this may not have been true in the
past, because of the presence of large ore deposits within
the country, coupled with high demand for these ores.
However, with ever increasing demand and the depletion of
native ores, the United States must lonU abroad for much
of its raw material. Since these materials are brought by
ship, and ships of ever increasing size, smelters must be
given a port location. On the American west coast, smelters
are located at Tacoma, Washington and at Selby, California
near San Francisco, using ores from abroad.
Miscellaneous. To be noted among industries which
seek a port location are cement and fertilizer. Of course,
chemical industries desire port locations. The production
of Aluminum necessitates importation of large quantities
of bauxite. However, this industry has usually developed
special ports of its own, at sites away from established
commercial ports. Not to be forgotten is flour milling.
A port location is convenient, if the flour is exported or
the grain imported. The refining of vegetable oils is
also similar to the above. Sugar refining is another.
These port industries, with the exception of ship
building, all use raw material products that undergo a
necessary break in transport. This break is a point where
195
raw material must either change the form of carriage or
undergo physical or chemical change. The transshipment
factor is the overriding element in the location of these
industries at a port. The fact that the raw material, or
the finished products, is either exported or imported from
abroad is important.
Port Industries, Their Gravitational Attraction On Other
Basic Industries
The petro-chemical industry is attracted to petro
leum refining because of the large number of petroleum
products required. The petro-chemical industry produces
numerous products. The manufacture of synthetic rubber is
one segment. In the past it has been a part of the petro
chemical industry, but it is now regarded as being a
separate industry. Another emergent petro-chemical has
been plastics. As with synthetic rubber, it is no longer
a subsidiary industry. Both industries can be important
features of an industrial complex.
Of course, the chemical industry per se is not to
be slighted. Because of the possibility of overseas ship
ments of raw materials, and the nearness to petroleum
refining, the chemical industry finds the port location
196
attractive. Associated with petroleum refining and the
chemical industries are research facilities established
by oil and chemical companies to further product develop
ment. This activity will be attracted to the refining and
chemical industries location.
Linkages among industries in itself may not induce
agglomeration, for other factors besides raw materials
availability may be more important. For instance, because
a steel mill is located at a port site in order to take
advantage of imported ores, does not imply that the auto
industry, a user of steel, will locate nearby. Other cost
factors will be the deciding factor in auto plant location,
not the close availability of steel. Other factors may
include nearness to markets, availability of labor, desire
to reap external economies, or transport factors not
influenced by the port. The introduction of these factors
to the port will mean a port city may become a desirable
location, as other industries, attracted previously to the
port, are present. An additional factor is that a large
population creates a large market. Furthermore, labor is
available at such centers. Cities create by their exist
ence, external economies. New firms find this especially
helpful in making a start. The concentration of shipping
197
facilities such as water transport, air, rail, and highway
make the shipping problem easy for firms located in a port
city. Due to competition, carriers will be more willing
to cater to their customers. Therefore, the port city
as it develops into a center of population, creates
additional pull on other base activities.
The port authorities and city planning commissions
have set aside certain areas within the port, zoned for
industrial use. Side channels are often built in order to
increase the waterfront area. Industries requiring a wharf
must locate on a channel. Characteristically, this type
of industry will be located on one of these artificial
channels. However, industries not requiring direct water
contact should be located further back in one of the
industrial zones. The prime waterfront space in any port
must be left to the transshipment function of commercial
shipping.
IV. ENTREPOT ACTIVITIES. AN IMPORTANT SOURCE
OF INCOME FOR LARGE PORT CITIES
Entrepot business functions are not the exclusive
jurisdiction of entrepots. They are characteristic of any
large port. The distinct aspect, in their relationship to
198
the entrepot, is their great importance. At many small
ports, certain port business services may be virtually
absent. Such functions would then be handled by a large
city in the same economic region.
These entrepot functions involve numerous middlemen
specializing in foreign trade operations. Among these are
import merchants who act as wholesalers. They buy foreign
goods, ship them to the home country, and wholesale the
goods. Moreover, they might be the exclusive agents of a
foreign company. Another middleman operation is the import
or export commission houses. Factors or commission mer
chants carry on the same type of business. The commission
houses do not acquire ownership of the goods, but rather
they act as agents for the manufacturer or wholesaler.
With imports they dispose of the goods, relaying the
proceeds of the sale to the seller with, of course, a
deduction for their commissions. On the export side, the
house acts as the agent for the foreign buyer. Another
middleman function is the broker. As commonly used, the
term designates an individual who brings buyer and seller
together, but who does not handle the goods. Customs
brokers assume the responsibility of getting the merchan
dise cleared through customs. To have knowledge of the
199
regulations and numerous forms required for foreign trade
is a specialty in itself, a specialty undertaken by the
customs brokers. For shippers located within the interior
of the nation, the broker may handle freight forwarding.
Somewhat similar are import or export brokers, who handle
goods consigned to them.
Another specialty is freight forwarding, which
accounts for 75 per cent of all freight shipped from the
22
United States. Freight forwarders assume all responsi
bility for transferring, documenting, and shipping goods
to foreign destinations. Like importation, exportation
entails numerous documents. Much of this has been a
result of the cold war. Various regulations exist on the
exportation of many products to countries doing large
business with Communist block nations. Many freight
forwarders act as customs brokers as well.
These middlemen functions can be combined into one
firm; however, with the large port, each above category
emerges as a distinct specialty. In the very large ports
further specialization will take place. Import and
^Paul V. Horn and Henry Gomez, International Trade
Principles and Practices, 4th ed., (Englewood Cliffs, New
Jersey: Prentice-Hall, Inc., 1959), p. 521.
200
commission merchants may be generalized, dealing in a wide
assortment of goods, or they may specialize. Some may deal
in manufactures of one sort or another. Others may handle
only coffee or sugar. This lends to the creation of
exchanges. With early city development there will arise a
general merchants' exchange. Here the city businessmen
may gather, discuss business, and make transactions.
Eventually, as the city grows there will be a need for
other exchanges. Examples are exchanges for wheat, cotton,
and coffee. With importing or exporting, large manufac
turers or retailers may maintain a staff of their own in
order to take care of these middleman functions. However,
only very large manufacturers or large retailing chains
would find it profitable to do so.
Of great importance is banking. Originally com
mercial banking dealt exclusively with commerce. The
banker extended the credit on which the wheels of trade
moved. The credit pyramid has been sustained by the
banking system. The manufacturer received credit for goods
produced before their sale or export. While the goods
were in shipment, they were carried by the banks. The
buyer would not pay for the products until they were
delivered to him. Banking thrived on trade and was
201
necessary for its continuance. Large banking houses have
also been a feature of all entrepots and smaller trade
centers. Any port doing foreign, or even domestic trade
needs banking services.
Insurance is similar to banking in that it
developed from trade. Cargoes and ships were both insured,
certainly insurance was a necessity of earlier uncertain
ages. Establishments selling marine insurance became
features of all large ports. During the nineteenth century
the insurance on a ship and cargo was always carried by
numerous insurance companies because of the risks involved.
As trade developed, banking, insurance, and the
middlemen flourished, thus the entrepot came to be a great
center of finance. The city that was fortunately located
at a transshipment point could expect prosperity from the
commerce that passed through her gate.
V. FROM THE PORT'S ECONOMIC BASE, SERVICE ACTIVITIES
MAY BE ESTIMATED
Ports foster a myriad of activities. Some of them
are related to the operation of the port. Others find the
location essential because of the transshipment factor.
Still others are attracted because they need the close
202
proximity of port industries. Finally, there are the
financial activities that, in the case of important ports,
have become important elements in the economic milieu. All
of these port-related activities are a part of the economic
base of the city. As the port city develops, other indus
tries will be attracted and will constitute a part of the
base, even though they are not associated with port
activities. Such industries, because they are not gener
ated by the port, are not concerns of this study.
If we are to accept the reasoning of the economic
base theory, the conclusion is that these industries in the
economic base will exert gravitational attraction on
service industries. The service industries cater to the
needs of the city's population. Governmental services and
the school system loom large here. In addition, there are
the numerous retailing establishments. The characteristic
of these service industries is that they do not export.
Their economic sphere is the city or local community.
Andrews divides service activities into two general
classifications.23 The first classification is service
23Richard b# Andrews, "Mechanics of The Urban
Economic Base: A Classification of Base Types,"
Pfouts, 0£. cit. p. 58-9.
203
activities which import goods, services, or capital. These
goods are processed locally or are simply distributed.
Many retailers can be included within this category. Bak
ing concerns, newspapers, and the construction industry all
import raw materials for local processing. The second
classification for service industries are those in which
raw materials, fabrication, or service production, and
capital origination is entirely local. Personal services
would be included, such as medicine, barbering, and the
practice of law. The local use of the community's invest
ment funds is also included. Local governmental and
educational activities would be listed likewise under
class two.
In estimating service activity, an analysis of the
economic base is necessary. Moreover, a projection of the
future basic employment, payrolls or both, is needed. By
knowing both the extent of the economic base and its future
trend, an estimate may be made of the service sector now
and also for the future. Previously, it was stated that
Hoyt had estimated this to be between 1:1 and 1:2. Other
ratios may be utilized in order to find total employment,
or total population, as described previously in this
chapter.
204
If a new port were to be built at an established
city, the total effect could be estimated by the use of
economic base theory. Naturally, an analysis would have
to be made of the activities of the new port. Certainly,
the most difficult thing would be a projection of changes
in the base. For this would be dependent not only on the
effort of the chamber of commerce to attract new firms,
but also on the overall outlook for business in the future.
Furthermore, the new port may not develop, because of
competition from older ports. However, powerful economic
forces exist, stemming from a port, that influence
industrial growth and specialization.
CHAPTER VI
SACRAMENTO, A CASE STUDY OF A NEW PORT AND ITS PROSPECTIVE
CONTRIBUTION TO THE LOCAL AND NATIONAL ECONOMY
I. THE EARLY CITY, A CITY THAT GREW
FROM RIVER PORT ACTIVITY
John Sutter's founding of a colony in California's
central valley is an oft-told story. Sutter desired a
tract of rich land and also the means to convey the
produce of his future inland rancho to the sea. Sutter
ascended the Sacramento River with two small schooners and
a pinnace. At the confluence of the Sacramento and
American Rivers, Sutter found what he sought, rich farm
land. As the two little schooners had no difficulty in
ascending to this point, there was assurance that a trans
port route was open to the coast. Two years after his
arrival in 1839, Sutter started work on his fort which was
built a few miles from the Sacramento River.
Sutter's tranquil life was interrupted by the horde
of people that descended upon the Sacramento Valley during
the gold rush. Because of the accessibility of Sutter's
Fort via the river, the fort became the first destination
for the gold seekers. For those coming overland to Calif
ornia, the fort acted as a lodestone as well. A city
eventually grew in the fort's vicinity. Small sailing
ships could ascend the river. In May of 1849, the first
ocean-going vessel from the east coast arrived. It was
the three masted schooner Whiton of 240 tons. This small
schooner drew 9 1/2 feet of water. Its trip was made in
143 days. Three of these days were spent between the
entrance to San Francisco Bay and Sacramento. One day in
1850, there were 65 steam and sailing vessels at the city
waterfront.^- Sone of these vessels, because of a lack of
buildings in the new town of Sacramento, became floating
retail outlets. They would moor to the river's bank and
set up shop. River activity increased in importance. In
1853 there were 25 steamboats on the Sacramento River with
a tonnage of 5,075. Their value was estimated at one
million dollars. As noted before, the presence of a
^"Myrtle Shaw Lord, A Sacramento Saga (Sacramento:
Sacramento Chamber of Commerce, 1946), p. 123.
^Hubert H. Bancroft, History of California. Vol.VI,
(San Francisco: The History Company, 1890), p. 461.
207
transshipment point is a powerful stimulus to the growth
of a city. Thus Sacramento was to follow the same pattern.
During the gold rush, it became a retailing and service
center for mining activity. Eventually, river traffic
suffered from shoals in the river created by extensive
hydraulic mining in the area. Then, of course, the
railroad was to take its toll of the river commerce.
However, many a town arose because of the gold
rush only to be forgotten after the boom was over. This
was not to be the case with Sacramento. For one thing, a
political decision was to help this city retain the great
importance it achieved during the 1850's. For after play
ing musical chairs among various cities, the state capitol
was permanently settled there. This gave the city a
permanent industry, namely government. Because of the
importance the city had achieved, plus regular river
steamer service to San Francisco, it seemed the logical
point as a terminus for the transcontinental railroad.
The completion of this railroad made communication easy
with the eastern states. More settlers came via the
railroad to California's great central valley. Agricul
tural production increased markedly, and new manufacturers
came to Sacramento because of the railroad.
208
River traffic was always vigorous on the
Sacramento. However, the increasing importance of the
railroads doomed commerce on most of the rivers of America.
Yet in California, the 1920's saw the entry into California
river trade of two excellent river steamers, the Delta
Queen and the Delta King. Carrying passengers and cargo,
these operated through the depression. They made alternate
runs from San Francisco up the Sacramento River to the
state capitol and up the San Joaquin River to Stockton.
However, these two steamers could not make a success of the
venture. After their passing, California rivers were left
without this form of transport, except for the river barges.
II. EFFORTS TO ESTABLISH A DEEP-WATER PORT
It must be remembered that in the beginning of
Sacramento's history, ocean-going vessels did call there.
A number of factors worked against the continuance of
seaport activities. One is the silting and shoaling of
the river due to hydraulic mining. The increasing size
of merchant ships over the years hindered development of
an ocean port. Even at the beginning of the gold rush,
only small sea going vessels could ascend the river. Also,
San Francisco's advantageous geographical location made
209
her California's entrepot before the twentieth century.
However, Sacramento never quite forgot its early
seaport or the possibility of re-establishing one. After
years of neglect the topic again came up in 1902. In that
year Mr. P. J. Van Loben Sels, in an address to the
Chamber of Commerce, stated:
The federal engineers even now announce that they
will only assist in procuring a channel of a depth of
five feet, claiming there is no demand for a greater
depth. Gentlemen, that notion had better be knocked
out of them, and proper representation made to Con
gress that what Sacramento wants is a channel to the
sea of 26 feet depth, nothing else will satisfy us.
Gentlemen of Sacramento County, it is my belief, that
no steps can be taken which will bring success, wealth,
colonists, and capital to your city so quickly and so
surely as by making your town a seaport. Let "Sacra
mento, a Seaport" be your watchword from now on. That
once established, all other good things will follow
in its wake.3
Despite the enthusiasm, most of the attention given to the
river was in relation to flood control.
A serious effort to provide a channel was made in
1916. A member of the state engineering department, Major
Paul M. Norboe, stated at a gathering that a deep-water
channel could be had at a small cost compared to the
advantages offered.
■^Lord, o£. cit. , p. 135-6.
210
With funds advanced by both the City of Sacramento
and the state engineering department, a survey was under
taken by the state under Major Norboe. The results of the
survey were favorable toward the creation of a deep-water
port.
The next important step was a report on the
feasibility of a deep water channel for the Sacramento
River by C. E. Grunsky, a consulting engineer from San
Francisco. This report also acknowledged the desirability
of a deep water channel. In 1934 an instance arose that
demonstrated steamship companies would use a deep-water
channel, providing one were in existence. A Shepard Line
ship, the Harpoon, called at Sacramento. The visit was
made at high water and the cargo consisted of eastern
manufactures, steel articles, hardware, and automobiles.
However, in the following year a serious blow was dealt
the deep water project by the federal board of engineers
for rivers and harbors. Special consideration, including
a trip to Sacramento, was given to the ship channel
question. However, the report filed in 1935 was adverse
to the scheme. Despite this, Sacramento continued its
fight for the port. On January 26, 1938 the Sacramento
Bee stated,
211
The present ten foot channel, together with the
terminal rates granted, have been of tremendous
assistance, but the Chamber contends that a thirty
foot channel is imperative if Sacramento and her
rich hinterland are to achieve the great industrial
destiny in store for this region.^
Another attempt at securing a channel was disap
proved^;, by the U. S. Army Engineers in 1939. In spite of
the country being at war, Sacramento continued its fight
for the deep-water channel. One hundred thousand dollars
was raised by the Sacramento Chamber of Commerce to assist
the Army Corps of Engineers. With $15,000 of the $100,000,
a survey was made among shippers concerning the tonnage of
goods moved into and out of the area. In June 1945 the
break came finally, for then the Army Corps of Engineers
made its final approval. The following year Congress
authorized the deep-water project.
The total cost of the development was divided
between the federal government and local authorities. The
national government undertook construction of the channel
including the turning basin. Also it agreed to undertake
future maintenance of the channel. The local government
undertook to provide rights-of-way, terminal facilities,
^Ibid., p. 154-5.
212
belt railroad, and relocation of utilities. In 1947 the
California state legislature appropriated $750,000 for the
purchase of rights-of-way, easements, et cetra. The
Sacramento-Yolo Port District was also created. It was
authorized to sell $3,750,000 General Obligation Bonds in
order to begin construction. In the summer of 1949, ground
was broken for the project. The expected date of completion
was to be July, 1953. Work on the port stopped during the
Korean War. Construction was not resumed until 1956.
However, construction dragged along. Only firm determina
tion on the part of Sacramento pushed the project forward.
In 1961, the voters of the port district approved General
Obligation Bonds totaling $9,850,000 by a 7 to 1 majority
in order to complete the port facilities.^
Concerning the total cost, the army engineers
estimated that the federal government had expended
$38,571,000 by June, 1963 for its part in the project. At
the same date the port district had spent $16 million.
Therefore, the total federal and port district expenditures
totaled about $55 million by June of 1963. There have been
^W. G. Stone, "Brief History of The Sacramento
River Deep Water Channel Project," (pamph.) 1963, pp. 2-3.
213
other expenses undertaken by the State of California. The
Rio Vista bridge downriver from Sacramento had to be
rebuilt at a cost of $3,200,000. Another $308,000 was
expended by the state in building the West Sacramento
Freeway, thus providing access to the port. The Army Corps
of Engineers has estimated the benefits to cost ratio to
be 2.2 to 1.0.^ As expected, the assessed valuation of
the port district has advanced tremendously. When the
port district was created, the assessed valuation of the
port area was $229,836,342. However, assessed valuation
for the same area rose to $963,810,478 for the year
1962-63.7
Thus the effort to gain a seaport at Sacramento
finally met with success. Both the benefit-cost ratio,
estimated by the Army Corps of Engineers, and the increased
assessed value of land in the area are healthy economic
indicators as far as the port is concerned.
6Ibid., p. 3.
^W. G. Stone, "Port of Sacramento," (pamph.), 1963.
214
III. SACRAMENTO’S INDUSTRY, POPULATION, AND
MARKET POTENTIAL IN THE 1960'S
Industry
Sacramento's strategic location in California's
great central valley has insured its historical growth as
a service center for the valley's agricultural industry.
It became a distribution center for manufactured articles,
and also a collection center for much of the valley's
produce. Through its close connection with agriculture,
canning and food processing became important elements in
city manufactures. In addition to this, the establishment
of the state capital created another industry.
During the early 1950's Sacramento's industrial
base began to increase and diversify. For Sacramento's
economic life, 1951 is a benchmark year. At that time
Aerojet-General Corporation, a maker of missile engines,
constructed a plant. The importance of this firm cannot
be underestimated. In 1953 employment at Aerojet was 771.
It increased as follows for 1956, 4,637; for 1959, 15,000;
and for 1961, 17,000. As of July 1963, Aerojet employment
stood at 18,700.® in 1961, of the 17,000 employees, 8,000
^Sacramento City-County Chamber of Commerce, "Metro
politan Sacramento," (pamph.) July 1963, p. 6.
215
came from outside the Sacramento area. These new employees
and their families total 25,000 people. Furthermore, it
has been estimated that 7,500 jobs have been created in
other fields by the presence of the newcomers. The 1961
payroll for this firm was approximately $132,000,000.
Firms within the area received $16,000,000 for materials
and supplies. In addition, $11,500,000 was paid for con
struction. Since settling near Sacramento, Aerojet has
paid $2,300,000 in county property taxes.^ Aerojet was
not influenced in its locational decision by a possible
deep-water port. However, its general stimulus to the
local economy may be a factor in the justification for
a port.
In 1962, the Sacramento State College Real Estate
Research Bureau ran a study on Sacramento industry, using
location quotients. The location quotient is a mathemati
cal technique to determine a city's representation for a
certain industry in relation to the national concentration
of that industry. Computation of the quotient is relatively
easy. The formula is:
. E. Tsagris and Robert K. Coe; Changing Pattern
of Industrialization. Land Use, and Values (Real Estate
Research Bureau, Sacramento State College, 1962), pp. 14-15.
216
local employment In particular
industry
gross local employment
= = location quotient
national employment in partic
ular industry
gross national employment
A location quotient of one would indicate a perfect corre
lation with the national average. Anything below one would
indicate the representation was less than the national
average. A figure above one would show greater repre
sentation than the national average. In the Sacramento
State study, two dates were compared, 1953 and 1959.
Table 7 illustrates the findings of this study.
As could be anticipated, government ranks high.
Even the activities of the federal government are higher
in Sacramento than in other American cities. As we might
expect of a growing community, especially a California one,
the location quotient for the construction industry in both
1953 and 1950 was high. To be observed is that manufactur
ing rose from a location quotient of .37 to .62. Even as
of 1959, this was far below the national average. The
increase between the two years is attributed to the growth
of Aerojet. Wholesale and retail trade rank high along
with finance and insurance. Again it is the expected
217
TABLE 7
RELATIVE SPECIALIZATION OF INDUSTRIES BY MAJOR
CLASSIFICATION AS INDICATED BY LOCATION
QUOTIENTS, SACRAMENTO COUNTY, a
1953-1959
Location Quotients Specialization
Industry Title 1953 1959 1953 1959
Government 2.53 2.04 High High
Federal 4.48 3.44 High High
State 5.89 4.89 High High
Local .39 .38 Very Low Very Low
Mining .47 .44 Very Low Very Low
Qontract Construction 2.04 2.01 High High
Manufacturing .37 .62 Very Low Low
Transportation and
Utilities 1.56 1.07 High Average
Wholesale Trade 1.59 1.20 High High
Retail Trade 1.47 1.27 High High
Finance, Insurance,
and Real Estate 1.31 1.13 High Average-High
Services 1.37 1.11 High Average-High
aB. E. Tsagris and Robert K. Coe, Changing Pattern
of Industrialization, Land Use, and Values (Real Estate
Research Bureau, Sacramento State College, 1962), p. 66,
Table 16.
218
result, for Sacramento has been historically a service
center for the central valley. Besides Aerojet, there are
330 manufacturing plants. However, most are very small.
The canning industry ranks very high in employment.
Table 8 shows employment in the five largest manufacturing
firms during July 1963.
In addition, Sacramento produces soap, detergents,
furniture, boxes, wood moulding, paper plates, prepared
cake mix, milled flour, milled rice, bricks, and clay. Of
importance also are 44 machine shops, 2 grey irdn foundries,
1 steel foundry, 2 non-ferrous metal foundries, and 15
public warehouses. Among non-manufacturing employment,
government looms large. Table 9 illustrates this. The
total estimated employment in Sacramento County is 209, iotf°
Table 10 shows the various categories of employment.
*
Transportation
Sacramento is well-provided with transportation
services. Four airlines provide regular passenger service.
These include United Air Lines with 24 daily flights,
Pacific Airlines with 12 daily flights, Western Airlines
^Sacramento Chamber of Commerce, "Metropolitan
Sacramento," a pamph. July 1963, p. 6.
219
TABLE 8
SACRAMENTO EMPLOYMENT IN THE FIVE LARGEST
MANUFACTURING FIRMS, 1963 a
Name of Company Employment Products
Aerojet General Corp. 18,700 Missile Engines
Campbell Soup Co. 1,500 Canned Foods
Bercut-Richards Packing Co. 250-1,200 Canned Foods
Libby, McNeil, and Libby 250-1,400 Canned Foods
California Packing Corp. 150-1,900 Canned Foods
TABLE 9
PRINCIPAL SACRAMENTO NONMANUFACTURING
EMPLOYMENT, 1963 b
Employment Products
Government, Civilian 62,000 Governmenta1
Government, Military 11,680 Aircraft overhaul
Southern Pacific R. R. 6,000 Transportation
Pacific Telephone Co. 4,080 Communications
aSacramento Chamber of Commerce, "Metropolitan
Sacramento," (a pamph.) July, 1963, p. 6.
bIbid.
220
TABLE 10
SACRAMENTO EMPLOYMENT WITHIN SPECIFIC
CATEGORIES a
Government 62,000 people
Trade (Wholesale, Retail) .... 39,400 "
Manufacturing 33,800 "
Service 30,400 "
Construction 14,400 "
Transportation, Commerce, Utilities 13,300 "
Finance, Insurance, Real Estate . 8,000 "
Agriculture 5,200 "
Mining and Ag. Service..... 600 "
aSacramento City-County Chamber of Commerce,
"Metropolitan Sacramento," a pamph. (Sacramento: Sacra
mento City-County Chamber of Commerce, July 1963), compiled
from pp. 5-6.
with 2 daily flights, and West Coast Airlines providing
flights as well. A new metropolitan airport will be
completed in 1969 at a cost of $12.5 million and will be
capable of handling the largest jets.
Sacramento is a key nodal point in rail and truck
transport for the central valley. The city is served by
two transcontinental railroads, the Southern Pacific and
the Western Pacific. The Central California Traction
Company provides connections to a third one, the Santa Fe.
Another railroad, the Sacramento Northern, provides servic
between the Sacramento valley and Oakland. The city is at
the crossroads of the east-west, north-south highway
complex and is a terminal point for many trucking firms.
The Sacramento River has long provided a means for
the transport of goods. After the passing of the river
steamers, barge service provided the means for moving
goods. Agricultural products and petroleum have been the
principal commodities moved by this method.
Utilities
In regard to utilities, Sacramento faces no
problem. From the American River alone, there is suffi
cient water to supply 2,500,000 people until the year 2030
222
Water consumption has increased steadily.
Gallons Consumed^-
1951 ..................... 12,843,800,000
1962 ..................... 17,886,000,000
Gas, supplied by the Pacific Gas and Electric
Company has increased dramatically as well.
12
Total Cubic Feed Used
1951 ..................... 13,181,342,700
1962 ..................... 29,243,033,000
Before World War II, local sources of gas were abundant.
However, war activity cut deeply into reserves. Pacific
Gas, and Electric Company found it necessary to bring in
gas from Texas and New Mexico. Nevertheless, further new
sources were needed. Finally, the oil fields of Alberta,
Canada were tapped. In December, 1961 the 1400 mile
California Alberta Pipeline was completed at a cost of
$289,385,000. The purchase contract of the gas from
Canada calls for delivery of 415 million cubic feet per
day.^ The terminal point for the line is Antioch, Calif.,
a city relatively close to Sacramento. Considering the
^Sacramento City-County Chamber of Commerce,
"Sacramento Facts," (pamph.) 1963, p. 5.
^-2 Ibid t
^"New Energy, Down From The North," California
Vol. 53, No. 6, California State Chamber of Commerce,
June 1963, p. 12.
223
new source of gas, Sacramento's future needs are well met.
Electrical consumption has increased dramatically,
as the following figures testify.
KWH to Consumers^
1951 ....................... 530,164,656
1962 ..................... 2,145,918,904
Hydroelectric potential in the Sierras and the recent
development of atomic power plants guarantee future
electrical needs. Generally speaking, it can be concluded
that Sacramento is well-endowed as far as utilities that
rely upon natural resources are concerned.
Industrial Parks
There are a number of industrial parks within the
Sacramento metropolitan area; all are in various stages of
development. Zoned for heavy and light industry are the
following tracts.
Sacramento Region Industrial Foundation
505 acres, all utilities to be available
Southern Pacific Company main line and spur
Southern Pacific Tract
425 acres, all utilities to be available
Southern Pacific Company main line and spur
Lawrence Industrial Park
^Sacramento City-County Chamber of Commerce,
loc. cit.
224
111 acres, all utilities on site
Southern Pacific Company main line and
California Central Traction Company line
Westport Industrial Park
83 acres, all utilities on site
Southern Pacific and California Central
Industrial Parks for Distributive and Light Industry
Johnston Industrial Park
100 acres, all utilities on site
Southern Pacific and Western Pacific main line
Fuller Industrial Park
38 acres, all utilities on site
California Central Traction Company main line
Erickson Industrial Park
12 acres remaining, all utilities on site
Southern Pacific main line!6
In addition to the industrial parks, it has been reported
that there are several thousand additional acres within
the area zoned and also available for heavy or light
industry. As of July 1963, typical prices paid for indus
trial land outside the city limits, but within the
metropolitan area, ranged between $5,000 and $10,000 per
"Metropolitan Sacramento," Sacramento City-County Chamber
of Commerce, July, 1963, p. 2,
Traction Company
acre.
^Standard Industrial Survey Summary Report,
16Ibid. 17Ibid., p. 3.
225
Military Establishments
Military installations presently are an important
segment of Sacramento County's economic base. The air
force maintains two important air bases. The first one,
McClellan Air Force Base, specializes in the maintenance
of aircraft. Modifications and engine rebuilding are also
undertaken. The base employs 14,500 civilians. Further
more, 5,000 military men are stationed at the base. The
second air base, Mather Air Force Base, houses numerous
air force activities including the Strategic Air Command.
Another milicary establishment, the Sacramento Army Depot,
employs 2,300 civilians and 800 military men.
Locational Decisions
The foregoing presentation is a picture of
Sacramento's industrial development to the present. It can
be concluded that the location of industries prior to the
opening of the deep-water port, was influenced very little
by the later facility. In 1962 the Sacramento State
College Real Estate Research Bureau conducted a study on
factors influencing the locational decisions of firms that
had located in Sacramento. In their survey, they inquired
whether 31 possible locational factors exerted a strong,
226
a medium, or no influence on their locational decision.
An examination of Table 11 reveals that 76 per cent
of all Sacramento firms stated that "Availability of
markets" was a strong deciding factor. The same percentage
indicated that "Availability of future markets" was a
strong factor. The "Availability of land for a plant site"
gave a strong response at 52 per cent. Equally as impor
tant are two categories, one named the "Availability of
needed labor" and the other one "Productivity of the labor
force." Adding these two categories together discloses
that 90 per cent of Sacramento firms gave labor a strong
ranking. The deep-water harbor, at that time not in
existence, obtained a "strong" rating by 20 per cent of
the firms.
As can be assumed, a survey of all Sacramento
firms would distort the final results due to the presence
of many small firms in the survey. This would be the
typical service-oriented activity. Because of the heavy
weight given to the small firms in this table, another
table was derived from the sample that showed the responses
given by both large and small firms. In the study, any
firm with 50 or fewer employees is termed a small firm.
Those with 51 employees or more were designated as large
227
TABLE 11
FACTORS INFLUENCING INDUSTRIAL LOCATIONAL DECISIONS,
PERCENTAGE OF SURVEYED SACRAMENTO FIRMS
Sacramento
Strong Some None
Availability of Markets 76% 18% 6%
Availability of Needed Labor 45 42 13
Availability of Future Markets 76 17 7
Productivity of Labor Force 45 37 18
Land as Site for Plant 52 29 19
Adequacy of Industrial Zoning 33 44 23
Existing Transportation Facilities 45 39 16
Desirability of Living Conditions 42 39 19
Electric Power Supply 36 33 31
Local Taxes 41 31 28
State Taxes 36 28 36
Availability of Raw Materials 35 24 41
Cost of Labor, Existing Wage Rates 35 45 20
Local or State Laws and Regulations 30 40 30
Attitude of Community Toward Industry 30 45 25
Existing Building for Plant 29 30 41
Government Attitude Toward Industry 38 34 28
Employer-Labor Relations History 33 45 22
Water for Industrial Use 43 22 35
Overall Growth of State or Area 69 26 5
General Appearance of Community 27 44 29
Industrial Fueis--Coal, Oil, Gas 30 27 43
Effect of Climate Upon Production 31 33 31
Availability of Housing 22 48 30
Other Production Materials 16 41 43
228
TABLE 11 (continued) a
Sacramento
Strong Some None
Water for Domestic Use 32% 34% 34%
Warehousing and Storage Facilities 27 30 43
Deep-Water Harbor 20 26 54
Existence of Research Facilities 8 22 70
Community Financial Subsidy 7 14 79
aCondensed from Tsargris and Coe, Changing Pattern
of Industrialization, Land Use, and Values, Table 37, p. 10L
^Percentages are rounded.
229
firms. For the purposes of this study, there is no reason
to review the locational influences upon small firms.
Certainly, as a whole, they would be little influenced by
the presence of a deep-water port. However, the large
firms would be influenced. Table 12 lists various loca
tional factors for these large Sacramento companies. As
in the other table, firms were asked the degree that their
locational decisions were influenced by each factor.
"Availability of markets" again ranked first, with 72 per
cent of the firms ranking it as a strong influence.
"Availability of future markets" again ranked high. "Raw
materials availability" and "Water for industrial use" each
ranked third. Each obtained a 59 per cent rating as being
a strong factor.
When it came to the influence of a deep-water
harbor, there was a decrease in two percentage points,
compared to the survey for all business firms. Yet, the
percentage indicating that this factor had some influence
rose from 26 per cent in the all firms survey to 36 per
cent in the data for large firms only. No explanation is
given for this change.
It would seem that a change in a few percentage
points in such a study would indicate very little, because
230
TABLE 12
FACTORS INFLUENCING THE LOCATIONAL DECISIONS
OF LARGE SACRAMENTO FIRMS
a n n M B B a M m B B a B n M D M B n a B M H H H B n B B a B H M B B E a n B B
Large
Strong Some None
Availability of Markets 72% 16% 12%
Availability of Future Markets 65 25 10
Availability of Raw Materials 59 22 19
Water for Industrial Use 59 22 19
Land as Site for a Plant 53 35 12
Availability of Needed Labor 49 49 2
Existing Transportation Facilities 45 50 5
Productivity of Labor Force 44 50 6
Local Taxes 41 35 24
Overall Growth of State or Area 40 50 10
Desirability of Living Conditions 38 44 18
Cost of Labor, Existing Wage Rates 36 55 9
Employer-Labor Relations History 36 58 6
Government Attitude Toward Industry 35 41 24
Industrial Fuels--Coal, Oil, Gas 34 44 22
General Appearance of Community 33 40 27
State Taxes 32 41 27
Electric Power Supply 30 43 27
Adequacy of Industrial Zoning 30 52 18
Water for Domestic Use 30 40 30
Local or State Laws and Regulations 29 47 24
Effect of Climate Upon Production 28 38 34
Warehousing and Storage Facilities 27 37 36
Attitude of Community Toward Industry 26 62 12
Deep-Water Harbor 18 36 46
Other Production Materials 17 52 31
Existing Building for Plant 16 21 53
231
TABLE 12 (continued)®
Strong
Large
Some None
Availability of Housing 9% 69%
b
22%
Existence of Research Facilities 3 26 70
Community Financial Subsidy 3 21 76
aCondensed from Tsargris and Coe, Changing Pattern
of Industrialization, Land Use, and Values, Table 40,
p. 108.
^Percentages are rounded.
232
even if you make an arbitrary distinction between small and
large firms, the smaller of the large firms will dominate
the results in the study of the large firms. The decline
in the two percentage points was registered in the strong
column. Yet, there was an increase of ten percentage points
in the column labeled "some influence." This could be
interpreted to mean that as a factor of secondary impor
tance, the future location of a deep-water port was
significant to large firms. Such things as present and
future markets, plus availability of raw materials played
the primary role.
In evaluating this locational study, it seems
♦ *
deficient in the sense that only three categories are
established. Perhaps more could be gained by establishing
four categories. The category labelled, "strong" should
be split into two parts, for instance, very strong and
strong. In this way a better picture could be gained in
regard to locational factors and their influence on
Sacramento industry. As it is, the study fails to differ
entiate among strong locational pulls. It must be remem
bered that even though a deep-water port did not get a good
response, the study was undertaken over a year before the
opening of the port. The study does show that major
233
locational decisions were not made on the basis of a deep-
water port, before its establishment.
Population
As in the case of most California cities, the story
of Sacramento's population changes has been one of continual
growth. In 1930, the population of the county stood at
142,000 persons. By 1940, it reached 170,333 persons. The
year 1950 saw an increase to 277,140. The location of
Aerojet at Sacramento had a profound influence on the
area's population. In 1960 the population of the county
had attained 502,778. The Port of Sacramento is located
in Yolo County, a county lying to the west of Sacramento
County. In 1960 the population of this county was 65,727.
The estimated size of the population of Sacramento County
was 580,000 in 1963.
For the establishment of an artificial port must
an area sustain a specific population? The answer is "No."
If we are to accept the reasoning about the development of
port cities in the previous discussion, it can be concluded
that a population need not be present in order to start the
development of a port city. Rather it is the presence of
a transshipment point that is the stimulant.
234
In the case of the creation of an artificial port,
such as Sacramento, one of the elements in growth, namely
population, is present. Therefore, the question becomes,
will the port city develop into an important transshipment
point? A large population in the immediate area will
stimulate this development. Present day population is a
segment of what is expected in the future. According to
estimates made by the California State Department of
Finance, the year 1970 should see population increase to
773,200 in Sacramento County. The location of the port is
in Yolo County. Therefore, notice must be taken of
population growth there. The 1970 estimate for Yolo County
is 111,400. By 1980 Yolo County should have 165,100 people.
Sacramento County’s population is expected to reach
1,073,000 in that same year. An expanding population, of
course, guarantees a large labor pool. Along with this,
goes an expanding industrial base. Such a situation is
conducive to sustained industrial growth. External
economies become an important factor as this process
continues.
Markets
In conjunction with an expanding population, there
235
will be an expanding market. Purchasing power is a prime
ingredient in this connection. Figures are available on
total personal income. However, because they are totals,
they follow the same trend as population. Over a five-year
period, 1956-1961, total personal income rose from $919,217
18
to $1,416,575. Naturally, total retail sales is a
valuable indicator of the area's market potential. Over a
twelve-year period 1950-61, total retail sales in the
19
County of Sacramento increased 134.6 per cent. During
the same period, 1950-1961, retail sales of building
materials, hardware, and farm implements increased 70.7 per
on
cent. Also, during that period 1950-1961, retail sales
of furniture, household furnishings, and appliances in
21
Sacramento County increased 49.1 per cent. The above
percentage increases for these factors are most striking.
Again, as mentioned previously, if any one industry can be
singled out for its effect on the Sacramento economy, it is
Aerojet. The Sacramento economy has offered terrific
market opportunities over the past decade. Can this be
^California State Chamber of Commerce, "Economic
Survey Series," No. 22, 1963.
19Ibid. No. 9, 1963. 20Ibid., No. 10, 1963.
21Ibid. No. 8, 1963.
236
sustained? Much will depend on the response of industry
to the new port.
Present day Sacramento offers an expanding market
for the products of the world. As a prosperous growing
city in the world's wealthiest nation, it should beckon
world trade.
IV. THE SACRAMENTO-YOLO DEEP-WATER PORT, A NEW
ELEMENT IN THE ECONOMIC BASE
Introduction
After years of effort, Sacramento's dream of a port
came true. On July 19, 1963 the port was dedicated. This
port is the first U. S. deep-water general cargo port to be
opened in over thirty years. The Sacramento River has been
partially dispensed with as a means of navigation to the
port. Instead, a deep-water channel 30 feet deep branches
off from the river at a point above Rio Vista, and cuts
across the valley in a direct line to the new turning basin
at the port. This eliminates fifteen miles from the mean
dering river route. The turning basin, originally Lake
Washington, lies a few miles to the west of the Sacramento
River. This 25 mile deep-water channel is free from
current and flood waters; both would silt the channel if
237
present. As the whole area is flat terrain, the channel
presented no construction difficulties. The present route
for the channel had been recommended in the earliest
surveys. The distance from the San Francisco Light Ship
to Sacramento's Port is 105 nautical miles.
The first ocean-going vessels to call at the new
port were not merchant ships but rather navy vessels.
These were present for the dedication ceremonies. It seems
a sad commentary on the west coast maritime industry that
one of the member companies of the Pacific Maritime
Association did not send a ship to the port on the day of
its dedication. Certainly, the cost could have been justi
fied on the basis of the publicity gained. Equally
unfortunate is the fact that an American flag freighter
was not the first commercial ship to visit the port and
load a cargo. After years of effort to establish the port,
it would have been fitting for a California based steamship
company to have made the initial call.
On July 29, 1963, ten days after the dedication,
the first commercial ship arrived. The S. S. Taipei Victoiy
from Nationalist China came to load 5,000 metric tons of
bagged rice for Okinawa. Fifteen thousand people turned
out on this festive day. During the first months of the
238
port, few ships called. However, in January of 1964 six
ships visited the port, a number equal to all the previous
commercial visitors.
In regard to the physical and statistical
characteristics of the port, notice should be taken that
provision has been made for handling barge traffic. This
traffic is not only what could be expected between
Sacramento and the San Francisco Bay area, but also includes
barge traffic between Sacramento City and the communities
on the upper Sacramento River. At one time river traffic
on the Sacramento River reached as far north as Red Bluff.
A barge lock has been constructed between the turning basin
and the Sacramento River in order to take care of this
movement. Despite this, no effort is being made by
Sacramento interests to develop barge transport on the
upper Sacramento. One Sacramento official voiced the
opinion that the city was not giving sufficient thought to
this. Even if such a trade is profitable, would it be
advantageous for Sacramento to promote it? It would
establish a transshipment point from barge to ship. Yet,
considering the population of the city, this would be
insignificant; the value of the port for Sacramento lies
in its potential industrial generating power.
239
Services Rendered to Shipping, Cargo Handling, and Port
Personnel
The port itself forms a part of the economic base
of the Sacramento region. In a previous section of the
paper, an outline was presented that showed economic
activities connected with ports. One section was entitled,
"Services to Shipping." As far as services rendered to
shipping in the Port of Sacramento, little has developed.
There are 8 Sacramento Channel pilots. However, every one
of them has a San Francisco Bay area address. No inde
pendent tug service has developed. At present there are
no Immigration or customs officials at the port. If
needed, these officials are drawn from other areas.
A few produce firms have sold some supplies to
ships. Despite the City of Sacramento's proximity to the
port, ship chandling firms in San Francisco have trucked
supplies to ships at Sacramento. Port officials are
optimistic about the selling of food supplies to ships.
Sacramento is situated in an area of agricultural produc
tion resulting in lower prices. Bunkering service can be
obtained at the port, but port officials do not believe
that there will be much growth for this activity, because
of the presence of excellent bunkering facilities near
240
San Francisco.
To date the operation of the port has done little
to increase the economic base of the Sacramento Metropolitan
region. If shipping increases sufficiently, the longshore
industry will find a home there, thus benefiting the
industrial base of the city. As of January 1964, the
longshore industry had not been established in the area.
Needed longshoremen were being supplied by Stockton. As
soon as shipping warrants it, the longshoremen will
establish a local at Sacramento. Despite the fact that
the port is deficient at present, there seems to be enough
activity to keep 25 people employed in the Sacramento
harbor department. Such activities as foreign consular
services, fumigation , are not present at all.
Present Cargoes Moving Out of The Port
Since the port has been in operation for such a
short time, little cargo has been moved. Likewise, no
discernible pattern in cargo movements has emerged. A
pattern will be established with time, perhaps in two to
three years. The only cargoes moved up until January 27,
1964, have been bulk agricultural goods. The general cargo
terminal has handled 27,000 long tons of sacked rice since
241
the port's opening. The bulk terminal at the port has
shipped 50,000 long tons of rice. Rice has been the
principal grain to be shipped. The Rice Growers Associa
tion has handled these shipments and has been active in
promoting shipments of rice through the port.
Cargill Inc., a handler of grain, has shipped
40,000 long tons of cargo through the port as of mid-
January. Alfalfa pellets and wheat have been handled also.
In January 1964, the United States Department of Commerce
approved an $85 million license for the shipment of wheat
to the Soviet Union, according to the San Francisco Grain
Exchange. The trader involved is supposed to be Cargill,
I n c .^ This action will add undoubtedly to Sacramento's
grain shipments. Safflower seeds and milo have been
shipped as well. The port has been shipping logs. In
fact, 1 1/2 million board feet were shipped through the
port as of January 1964. These logs have been exported to
Japan, where they are sawed. There was a ten ton sample
shipment of wine to the Hawaiian Islands also. Besides
these bulk shipments, a small shipment of packaged goods
entered the port. However, this has been the only instance
^ Pacific Shipper. Vol. 38, No. 46, January 6,
1964, p. 17.
242
of general cargo moved. It was anticipated that canned
food would be one of the early products passing through
the port. This has not materialized.
Prospective Sources of Cargo
In the immediate future the port must rely on
agricultural products from the Sacramento Valley, southern
Oregon, and northern Nevada. Included in the Port of
Sacramento's hinterland are 24 northern California counties,
13 northern Nevada counties, and 4 southern Oregon counties.
The exceptional railroad and highway network centering in
Sacramento make this possible. The port of Sacramento is
the most economical transshipment point in this area. The
Sacramento Valley is one of the west's rich agricultural
regions. The port, by reducing freight rates to other
nations, will stimulate agricultural production. As a
result, we can expect value of farm land to increase in
this northern valley.
V. THE POTENTIAL INDUSTRIAL GENERATING POWER
OF THE PORT
Present Industrial Status of The Port
As of January 1964, no single firm, besides the
rice growers, had located in Sacramento because of the
presence of the deep-water port. However, as we do know,
18 per cent of the large firms had indicated that it had
been a strong locational factor in 1962. None of these
firms, however, have a port location. The port has not
begun to develop as an industrial port. Its present
function is the transshipment of goods, nothing more. The
best that can be said to date is that recent industrial
additions to Sacramento have indicated the possibility of
using the port. The Keyes Fiber Products plant, a producer
of moulded paper products, being built at a cost of
$9 million, has indicated a willingness to use the port.
Linde and Union Carbide are building a plant for the
manufacture of oxygen and hydrogen. The liquid hydrogen
will be stored in the world's largest liquid hydrogen
storage plant. This company has indicated a willingness
to use the port as well. By 1969 an unnamed Los Angeles
industrial firm intends to be using the port providing
their present plans for a Sacramento County plant location
are realized. These firms have made locational decisions
in favor of Sacramento County. The port itself, however,
is in Yolo County.
The Sacramento Chamber of Commerce presents the
244
argument that industry need not locate at the port. They
claim a location within a 15 mile radius of the port is
equally as good. Trucking problems will be taken care of
by the proposed freeways in and around Sacramento. The
Sacramento Chamber of Commerce is rather specific in
regard to this 15 mile radius. In its opinion the appli
cable 15 miles is that portion lying within Sacramento
County. They seem desirous of steering industry to the
southern portion of Sacramento County. This area is at a
distance from Sacramento's central business district.
Moreover, a proposed freeway and bridge over the river
will eventually connect this area with the port. The
Sacramento Chamber discourages the idea that industry
locate at the port. They say that the advantages offered
are not significant. They fail to state that the port and
its industrial sites are situated in another county. Of
course, the effects of industrial growth at the port
though directly helping Yolo County would indirectly
benefit Sacramento County. Cognizant of this, Sacramento's
Chamber of Commerce is quick to discourage the idea of a
port location.
West Sacramento in Yolo County, where the port is
located, is across the river from both Sacramento City and
245
County. Much of the new industry locating in the
Sacramento region will choose a port location. At present
this area can account for a certain amount of industrial
growth. Specific companies include
American Crystal Sugar Company 250 employees
State Box Company 75 "
Fruehauf Trailer Company 41 "
Deweid Casing Company 38 "
Swift and Company 38 M.
We must also include the Rice Growers' rice handling
facility in the port, with its 450 employees. The service
provided by utilities is the same as for the City of
Sacramento. As far as industrial sites are concerned,
4,000 acres have been zoned for heavy and light industry.
The terrain in the port area is level, drainage adequate,
and the soil is good for supporting normal loads.
Only the land in the immediate vicinity of the port
is owned by the Port of Sacramento Authority. The Port
Authority will lease tracts to business firms. Immediately
to the west of the port and next to the channel, there is
a large industrial district of 600 acres. Rail and utili
ties are present. It is owned by Alaska Packers, which is
^"H/est Sacramento District Chamber of Commerce,
"Look Through The Porthole," a pamphlet.
246
a subsidiary of Calpak. In subdiving this the owners are
willing to either sell or lease. They will construct
buildings if a client so desires. According to officials
in West Sacramento, Alaska Packers are carrying on secret
negotiations with companies who are considering locating
in the area. As far as the port authority-owned area goes,
officials of the port were reluctant to provide information
as to whether negotiations were in progress with any
specific company that desired to locate in the port.
These two tracts are the only practical large
areas open for industrial development at present. The
area lying directly to the south of the port is handicapped
at present for possible industrialization. This handicap
arises from the lack of transport facilities in the area.
Bordering the north of this district is the deep-water
channel. The barge canal connects this with the Sacramento
River. At the barge canal there is a bridge connecting
north and south portions of the whole port area. The
Bridge is inadequate. If the lock is opened, the bridge
must be opened. It has been estimated that every time the
bridge is opened, trucks must wait a minimum of 15 minutes.
The result is a serious bottleneck. As long as this
condition exists, it is doubtful whether industry can be
247
induced to locate south of the port. At present, there
are no funds available for replacing this bridge. Even
more adverse than this, is the fact that to the east of
this southern tract is the Sacramento River. No bridge
crosses the river in this area. On the other side of the
river is the City of Sacramento. Farm land lies to the
south of the area. In the particular area lying toward
the west, there is a 1,000 acre portion that is partially
owned by Alaska Packers. This is being held for future
development
On the northern side of the port is an area of
200 acres that contains some rail facilities and utilities.
It is open to industrial development. There seems to be
nothing definite in regard to development for this district.
Also scattered about the West Sacramento area are numerous
acreages open to industrial development. Some are rela
tively close to the port. Others are at a distance.
To the west of the port and the Alaska Packers
Tract, approximately one mile, is an obstacle to industrial
development. It is the Yolo Bypass. This is an area into
which the Sacramento River is allowed to flow during flood
periods on the river. If not flooded, the area is used for
pasturage of cattle. The bypass will prevent industrial
248
growth along the channel not too far to the west of the
port. However, by 1972 when the California water plan is
executed, this condition should be alleviated. At present,
this is no obstacle to industrial growth because of the
yet unfilled tracts near the port.
West Sacramento has an advantage over the City of
Sacramento resulting from a problem in transportation.
Despite the number of freeways in the Sacramento area
there is still an inadequate number of them. The primary
problem is the river crossings. Today there are two
bridges, the Tower's Bridge and the I Street Bridge.
During the rush hours traffic is backed up for miles on
either side of these bridges. Considering such bottle
necks, it is doubtful whether a major industry which must
rely on the port will locate in Sacramento County. For
the immediate future we must expect that a port oriented
industry will locate in West Sacramento and on the
northern side of the port and deep-water channel.
Two new freeways are planned. The Belt Line
Freeway, coming from North Sacramento then crossing the
river and connecting with Highway 40 in West Sacramento,
is scheduled for completion in 1969. The second freeway,
the El Dorado Freeway, will commence in South Sacramento,
249
cross the river, pass near the port, and connect with
Highway 40 in West Sacramento. Construction on this is in
progress. This will give the Sacramento metropolitan area
a superb highway network. However, until it is finished,
there is a highway problem, especially as far as crossing
the Sacramento River. Sacramento officials do not admit
the existence of this problem. Rather, they emphasize
that a fine freeway network will come into being in the
future.
Sacramento feels it should be selective in luring
industry to the metropolitan area. For example, there is
pressure being exerted by the state capitol upon the local
chambers of commerce to discourage any industry that would
be a potential smog producer. Also industries which might
pollute the river will be discouraged. Neither leather
tanneries nor pulp mills are acceptable. For an area
desirous of industrialization, such a policy will hinder
growth. However, one cannot blame Sacramento for feeling
this way about industries that produce "social costs." Yet
excluding these industries, greater reliance must be
placed on light industry. Such industry may not consider
a port location to be important.
As of the beginning of 1964, industry was showing
250
a reluctance to move Into the port area. Many Interested
parties were taking the attitude of wait and see. The
feeling seems to be that some firms do not want to come
until they are assured that other Industries will follow.
The problem is in attempting to get 1 or 2 firms to make
the crucial decision about moving Into the port area. From
then on, it is assumed there will be a tendency to agglom
erate on the part of industry. There seems to be a feeling
of disappointment in Sacramento because things have not
moved faster in this regard. However, they fail to realize
that, as of today, no regular liner service has been
established by any steamship company. Moreover, to expect
rapid changes is an error in itself. Certainly, slow
growth is preferable to over rapid expansion. Once indus
try begins to move into the area, the whole process will
become cumulative. One industry induces another to come.
With adequate industry, steamship service will be provided.
Vital linkages, both forward and backward, between indus
tries will create a desire for agglomeration.
Another important factor determining industrial
location in the area is that certain Sacramento officials
feel that the land adjacent to the port is overpriced.
Perhaps subdividers and the port authority, because of
251
overzealousness, have made the mistake of overpricing the
land. This, combined with the highway problem, the newness
of the port, and the fact industries have not begun to move
into the area, is a good explanation for the lack of
response by industry to date.
What Specific Industries Can Be Expected To Locate Near
The Port?
In speaking of new industries for the port, it is
wise to consider possible industrial development for the
whole deep-water channel area. It has been reported that
15 miles of the 43 miles of deep-water channel presents
the possibility for development. Many Sacramento leaders
believe that the Sacramento Valley's rich agricultural
production will lead to an ever increasing growth in
canning and food processing. The port will bring the world
market ever closer. The manufacture of equipment used in
the food processing industry is an industry that many
believe will be established. Not long ago machinery for
the making of pizza was shipped from California to Italy.
Any industry that uses agricultural goods in its productive
process is a natural one for Sacramento. Lumbering is a
northern California industry. Eighty-five per cent of
252
California lumber production is located within 200 miles
of Sacramento. As mentioned before, 1 1/2 million board
feet of logs have been shipped from the port. Any industry
using lumber as a raw material Is a good prospect. An
expansion of the furniture industry is a possibility.
Various types of paper products are all derived from wood.
However, as mentioned, it has been intimated that Sacra
mento is not interested in any pulp mills because of the
air pollution problem. Therefore, any future paper indus
try must seek a location further down the channel, somewhere
in the vicinity of the lower Sacramento River. There are
industrial minerals in the Sacramento area. Included are
sand, gravel, asbestos, lime, pyrites, gold, and silver.
Again, it is the question of attracting industries that
use these as raw materials.
In an industrial port, shipyards and ship repair
facilities will be found. Sacramento cannot hope to
attract shipyards. The San Francisco Bay area is too near.
Ship repair work will be undertaken there. Moreover, there
is not enough room in the port for any large-scale facility.
The production of cement is found in port areas. This is
a good possibility for Sacramento's port. Companies
producing fertilizer, because of the possible importation
253
of nitrates, find a port location convenient. Considering
the possible fertilizer needs in an agricultural area such
as the Sacramento Valley, the creation of a fertilizer
plant in the port area would seem logical. However, in
advancing this idea to a few Sacramento officials, it was
admitted that no thought had been given to this possibility.
Petroleum refining finds a port location very
compatible with its needs. A port city will mean a large
population and consequently a large market. Moreover,
with increasing reliance on imported crude oil, a port
location is becoming a must. Would a petroleum refinery
find a suitable location at Sacramento? The mode of
supplying petroleum is by barging it up to Sacramento from
the refineries in the San Francisco Bay area. Moving
*
petroleum by barge is relatively inexpensive. Therefore,
savings in cost would not be very great. In the case of
Sacramento, it could be reasoned that no petroleum refin
eries will locate in the port area until a greater market
for petroleum products exists. Sacramento port officers
have not given this particular question any thought either.
A chemical industry, requiring imported raw
materials, may find the port location attractive. However,
such an industry may be discouraged because of the fear of
254
air pollution. Flour milling and vegetable oil processing
should be encouraged certainly. In West Sacramento, there
is a sugar refinery that relies upon sugar beets. In the
future, it is possible for this facility to expand and use
imported sugar. Glass manufacturers, who often use
imported sand, would be a welcome addition to the port's
industrial base.
As far as entrepot activities are concerned, none
are being performed at present. It is doubtful whether
such businesses as customs brokers or freight forwarders
will be established for awhile. Sacramento wants to
attract industry that will desire a port location. The
emphasis seems to be on just industry. No differentiation
seems to be made on the part of Sacramento officials in
regard to industry in general and industry that has tradi
tionally sought a port location. It would appear that they
would achieve greater success if they took such a differ
entiation into consideration. At present, it seems to be a
shot-gun approach to the obtaining of industry. The main
worry seems to be whether new industry will create smog or
pollute the river. Furthermore, one feels that they are
not eager to see an industry locate in the area that emploje
a large percentage of poorly paid people.
CHAPTER VII
STOCKTON, AN ESTABLISHED PORT IN CALIFORNIA'S
INLAND EMPIRE
I. AN HISTORICAL OVERVIEW OF THE CITY OF STOCKTON
The City of Stockton can trace its origin back to
the gold rush days of '49. Like Sacramento, it was a port
of entry into California's interior. The miners of the
nineteenth century used water transport between San
Francisco and Stockton. From Stockton, it was but a short
distance into the Sierra Nevada Mountains. As with so many
cities, it was the case of a transshipment point developing
into a city. Stockton became an important trading post and
supply center for the mining industry. After the gold
rush, agricultural commodities came to be an important item
in transshipment. Stockton assumed the distribution and
collection function for the San Joaquin Valley. What
passed through the port of Stockton, however, was destined
for the San Francisco Bay area. Here San Francisco, as
California's entrepot, took responsibility for these car
goes. At San Francisco the commercial break occurred,
255
256
the commercial break meaning the change of ownership for
these agricultural goods.
Local business interests began planning for a sea
port as early as 1910. Stockton did secure finally, a
congressional appropriation for a 9-foot channel between
Stockton and the San Francisco Bay. However, Stockton
interests pressed for a deep-water channel. Finally, the
Army Corps of Engineers, the Interior Department, and
Congress approved a 24-foot channel. It was eventually
extended to 30 feet. Stockton's share of the channel's
construction was to secure the right-of-way for the channel
and to pay half the cost of dredging. Stockton was to
construct the terminal facilities also. The voters of
Stockton approved a $3 million bond issue for its share of
the work. Five hundred thousand dollars was obtained from
the State of California. In January of 1933 dredging
operations and terminal facilities were completed; thus a
new port was opened. During the port's first year of
operation, 309,546 tons of cargo were handled.
257
II. PRESENT-DAY INDUSTRY, POPULATION, AND
MARKET-POTENTIAL OF STOCKTON
Industry
As with Sacramento, Stockton is a city located in
the midst of an agricultural region. It is a service
center for the San Joaquin Valley. This valley is the
southern segment of California's great central valley. It
is a rich agricultural region. Tulare and Fresno Counties
in the central portion of the San Joaquin Valley were the
nation's highest income farm counties in 1963. These
counties and the San Joaquin Valley in general are the
background for Frank Norris' famous novel of social protest,
The Octopus. This book deals with the struggle between
the farmers of the valley and the Southern Pacific Railroad
during the 1880's.
At present Stockton has developed some industry.
There are 349 manufacturing plants in the greater Stockton
area.^- Table 13 lists the leading employers in 1963.
According to the Chamber of Commerce, the early
1960's have been bright ones for Stockton. For one thing,
^-Industrial Department, Greater Stockton Chamber of
Commerce; Standard Industrial Survey Summary Report," a
pamphlet.
258
TABLE 13
THE LEADING STOCKTON EMPLOYERS, 1963a
Manufacturing Employment
Employees Product
Fibreboard Products, Inc. 1,100 Paper and paper cartons
Stockton Box Co 500 Walnut Processing
International Harvester Co 275-300 Agricultural Implements
American Can Co 300-350 Tin and paper containers
Johns-Manville Corp 400 Asbestos Cement Pipe
Libby-Owens Ford Glass Co 250-300 Laminated glass
Non-manufacturing employment Type of Business
Sharpe Army Depot 2,000 Military and maintenance
Naval Annex 439 Naval supply
Port of Stockton 1,658 Deep-water port terminal
TABLE 14
MAJOR CATEGORIES OF EMPLOYMENT WITHIN ST0CKT0Nb
Trade (Wholesale and Retail) 19,450 persons
Government 15,700
Agriculture 14,500
Service 13,125 "
Manufac tur ing 12,975
Trans., Comm., and Util. 6,025
Construction 4,625
Finance 2,625
Food manufacturing employment for 1962
January and February 4,300
September 10,100
industrial Department, Greater Stockton Chamber of
Commerce;"Standard Industrial Survey Summary Report,"
a pamphlet.
bIbid.
259
there has been greater diversification in manufacturing.
New firms have located in the Stockton area. These
include Laidlaw Corporation of the West, wire coat hanger
manufacturers, and Flangeklamp Corporation of California,
makers of grid suspension systems for accoustical ceiling.
Within San Joaquin County, but away from Stockton, new
firms have located. These include Electro-Neutronics at
Tracy, makers of radiation survey equipment and Northridge
Mills, Inc. at Lodi, women’s clothing producers. Another
new company at Lodi is Lectrolure Company, Inc., producers
of motorized fish lure. This diversification is indicative
that Stockton is beginning to move away from industries
oriented to agriculture alone. However, even today
manufacturing is agriculturally oriented, as the five
largest manufacturing firms show.
A better picture may be obtained of Stockton's
economy by a glance at the total labor market for San
Joaquin County. In 1963 the estimated total employment was
89,875 persons. The fields listed in Table 14 account for
this employment.
Transportation
Stockton is served by three transcontinental rail
systems, the Santa Fe R. R. Company, the Southern Pacific
260
R. R. Company, and the Western Pacific R. R. Company.
There are three smaller rail lines, The Central California
Traction Company, the Stockton Terminal and Eastern Com
pany, and Tidewater Southern R. R. Company. Thirty-one
regularly scheduled truck lines make stops here also. The
air terminal has seen recent improvements. A new terminal
building was put into operation in May 1963. The city is
served by Pacific Air Lines and United Air Lines. The
ocean port of Stockton is visited by approximately 37 dif
ferent steamship companies per year. The major highway
network is excellent. Highway 99 provides a north-south
link to other areas of the central valley. Highway 50
connects Stockton to the San Francisco Bay area and to the
eastern United States.
Utilities
The Pacific Telephone Company increased the number
of telephone stations from 70,528 to 74,106 between 1961
and 1962, an increase of 5.1 per cent. The Pacific Gas and
Electric Company found that sales of electricity in
kilowatt hours increased by 5.2 per cent between 1961 and
O
1962. Gas sales mounted 3.8 per cent during this period.
^Greater Stockton Chamber of Commerce, "Business
Review," a pamphlet, 1962, p. 14.
261
It is admitted that the comparison of only two years is
very inadequate. It is difficult to draw a valid
conclusion from such figures.
Growth
Perhaps, even more meaningful in regard to growth,
are construction projects. The following projects were
started in 1963: Weber Point Development, West End
Redevelopment Project, California Youth Authority Facility,
Weberstown and Sherwood Manor Shopping Center, and a state
office building of four stories. In 1962 the total number
of building permits issued for Stockton was 1,745 with an
evaluation of $16,325,986.^
Industrial Parks
There are numerous industrial parks within Stockton.
These, with their characteristics, are listed below.
Western Pacific Industrial District
450 acres, established 1954
Medium industry,
Will sell or lease land.
Port of Stockton Industrial Park
257 acres, established 1957.
Light, heavy, or medium industry
Will sell or lease land.
Buildings will be constructed by developer with
lease back arrangements.
^Ibid., p. 3.
262
Farmington Road Industrial Property
189 acres, established 1956
Land can be either purchased or leased.
Buildings will be constructed by developer.
For users of carload rail service.
Developer: Santa Fe Railway Company.
Stockton Industrial Park
186 acres, established 1957
Land can be either purchased or leased.
Buildings will be constructed by developer.
For users of carload rail service.
Developer: Santa Fe Railway Company.
Southern Pacific Industrial District
151 acres, established 1956
Light industrial
Land can be either purchased or leased.
Developer: Southern Pacific Company.
Stockton Industrial Sites
134 acres, established 1956
Land can be either purchased or leased.
For users of rail carload service.
Developer: Santa Fe Land Improvement Company
According to the Stockton Chamber of Commerce, the
total amount of land within the city limits zoned for heavy
and light industry is 3,000 acres. At present 45 per cent
of this is available. Anything between one-half to 351
acres may be purchased. The ground is good for industrial
growth. The terrain is level. Drainage is good. Moreover
the subsoil is capable of supporting heavy loads. Pilings
are not required.
^California, Magazine of Commerce, Agriculture and
Industry, California State Chamber of Commerce, June 1963,
p. 47.
263
Military Establishments
Sharpe Army Depot. Two thousand civilian employees
are on the staff. The depot serves the western United
States, Alaska, Pacific Ocean area, and the far east. Sup
plies for the army engineers and equipment for aircraft are
processed. Maintenance of aircraft is also undertaken here.
Stockton Naval Annex. There are 439 civilian
employees here. This is a portion of the Naval Supply
Center in Oakland. Its duty is to handle naval stores.
Pacific Reserve Fleet-Stockton Group. Three hun
dred and eighty naval men are stationed here. The purpose
of the group is to maintain 60 naval ships in a ready-to-go
status.
U. S. Naval Communication Station San Francisco.
There are 200 military and 114 civilian personnel here.
Locational Decisions
In regard to locational decisions, no study has
been undertaken of the City of Stockton as was undertaken
in the case of the City of Sacramento. However, the
industrial picture for Stockton is much simpler; therefore,
it is easier to make generalizations. For one thing, as
noted, all large Industrial firms are connected with
agriculture. It is natural for such firms to choose a
264
site within an agricultural area. For the San Joaquin
Valley, where is the logical site? It is the transshipment
point for this agricultural produce to the outside world.
This transshipment point is Stockton. Certain service
activities for the valley, such as retailing and banking,
were begun in this center. The growth of the city meant
that Stockton had the labor supply and the transportation
and communications complex that industry needed. Thus,
Stockton attracted the industries previously mentioned,
such industrial activities as paper and paper carton
manufacture, walnut processing, box making, tin can manu
facture, and agricultural implements production. Food
processing is another important industry.
Population
Projected estimates for San Joaquin County are
available to the year 1980. Therefore, in order to show
population growth for this area the county figures are
employed. These are shown in Table 15. Over a period of
fifty years the county's population increased five-fold.
In 1962 it was estimated that the population was 262,100."*
^California State Chamber of Commerce/'Economic
Survey Series," Number 14, March 1963.
265
TABLE 15
POPULATION GROWTH, SAN JOAQUIN COUNTY
1910-1960*
Year San Joaquin County
1910 50,731 persons
1920 79,905 "
1930 ................... 102,940
1940 ................... 134,207
1950 200,750 M
1960 ................... 249,989
TABLE 16
POPULATION GROWTH, CITY OF STOCKTON
1910-1962b
Year City of Stockton Urbanized Area
1910 23,253 persons 27,500 persons
1920 40,296
t i
44,301 "
1930 47,963
I I
61,880
1940 54,714
M
79,337
1950 70,853
i i
112,834
1960 86,321
t i
141,604
1962 89,500
M
148,287 "
aGreater Stockton Chamber of Commerce, "Stockton
Statistical Review," a pamphlet.
bIbid.
266
Future estimates for the county are:
Year
1970
1975
1980
San Joaquin County**
310,400 persons
. 343,400
. 379,400 "
Figures are also available for the City of Stockton up
until 1962. These are presented in Table 16. Figures for
both the county and the city have shown a healthy rate of
growth.
Market s
presents an encouraging picture. Figures are available for
San Joaquin County concerning changes in market conditions.
Total personal income for the county rose from $332,316,000
in 1950 to $609,319,000 in 1961.7 Total retail sales of
general merchandise were $22,485,000 in 1950. This rose to
$36,835,000 in 1961. This is an increase of 63.8 per cent.®
Retail sales of building materials, hardware, and farm
implements increased from $22,640,000 in 1950 to
As a market both now and in the future, Stockton
^California State Chamber of Commerce,"Economic
Survey Series," Number 14, March 1963.
7Ibid. Number 22, 1963.
8Ibid. Number 9, 1963.
267
$26,564,000 in 1961. This is an increase of 17.3 per cent
q
for the period. Retail sales of furniture, household
furnishings, and appliances rose from $12,818,000 in 1950
to $15,193,000 in 1961, an increase of 18.5 per cent.^0
During the last fifty years, markets and the potential for
new markets have expanded rapidly.
III. THE PORT OF STOCKTON AS A TRANSSHIPMENT CENTER
The Port1s Development
This seaport is relatively new. It was opened in
1933. During the first year of its operation the port
1 1
handled 309,546 tons of cargo. Perhaps it should be
noted that Stockton's port did not attract industry during
its first years of operation. The reasons for this will
be discussed later.
During the decade of the 1930's, the population of
the City of Stockton showed an healthy increase. Some of
this can be attributed to the increasing significance of
^Ibid., Number 10, 1963.
10Ibid., Number 8, 1963.
1 -^"Statement Showing Tonnage Handled Thru Port of
Stockton," a pamphlet, p. 1.
268
the port. However, in observing population increases
since 1910, it may be noted that there have been healthy
increases for every decade. This is remarkable for the
1930's because of the world-wide depression. Even for the
rest of California, population growth was not startling
during this period. However, the increase for the urban
ized area of Stockton for that decade was from 61,880 to
1 2
79,337, an increase of 21 per cent. What percentage of
this total can we attribute to the ocean port? Previously
it was stated that the port handled 309,546 tons during
1933. However, this was not indicative of the ocean
traffic. Ocean bound cargo amounted to only 75,999 tons.
During the first year of operation, 139 ocean-going vessels
called at the port. Table 17 shows the tonnage of cargo
moved over the ocean terminal facilities and the number of
ships calling at the port between 1933 and 1940. As
Table 17 illustrates, the port moved considerable amounts
of cargo. The number of vessels calling at the port during
this period is typical of a small port's activity.
Unfortunately, the figures for the tonnages of cargo moved
during the history of the Port of Stockton have never been
1 2 " S t o c k t o n Statistical Review," op.cit.
269
TABLE 17
CARGO TONNAGE MOVED AND OCEAN VESSEL CALLS,
PORT OF STOCKTON, 1933-1945®
Year
Ocean Terminal
Facilities Only
Direct Calls
Ocean Vessels
1933 .... . . . . 75,999 tons . ......... 139
1934 .... . . . . 260,551
1 1
......... 326
1935 .... . . . . 422,944
I I
......... 309
1936 ....
. . . . 411,762
1 1
......... 224
1937 .... . . . . 341,324
1 1
......... 172
1938 .... . . . . 344,773
I I
......... 171
1939 .... . . . . 384,817
1 1
......... 202
1940 .... . . . . 392,971
1 1
......... 124
1941 .... . . . . 212,325
1 1
......... 72
1942 .... . . . . 56,267
1 1
......... 5
1943 .... . . . . 95,642
1 1
......... 0
1944 .... .... 256,960
1 1
......... 78
1945 .... . . . . 301,663
I I
......... 65
a,,Statement Showing Tonnage Handled Thru Port of
Stockton," a pamphlet, pp. 1-2.
270
broken into commodity classes. We do know that agricultural
commodities made up almost 100 per cent of the cargo moved
during the 1930's.
Considering the depressed state of the American
economy during the 1930's, the fact that the ocean facili
ties at the port were used to the extent they were, indi
cates that the new port was a success. The operation of
the port during the 1930's did contribute to the growth
of the population during this era.
The Second World War stopped growth in the Port of
Stockton. A look at Table 17 clearly enumerates this.
Is there an explanation for such figures? As seen, cargo
continued to move over the wharfs of the ocean terminal
facilities. However, during 1943, no ocean going ships
called at the port. The tonnage movement represents ship
ments on the river. In fact, Table 17 shows tonnages moved
over the ocean terminal facilities only. Other terminals
handled cargo during this period, but again it was destined
for shipment on the river only. During the war years, the
U. S. Army leased a portion of the ocean terminal facilities.
As an ocean port, Stockton almost dropped into
oblivion during the Second World War. The exports of the
United States during this era consisted of military goods.
271
Stockton did not become one of the great transshipment
centers for military goods as Los Angeles, San Francisco,
or Seattle became. A political decision during the war to
use Stockton as an embarkation point and as a supply center;
would have been significant for the city.
It was not until the 1950’s that the port assumed
an important role as a transshipment point. Table 18 has
been included to emphasize this. In 1956 the port reached
the 2,000,000 ton mark, and the number of ocean vessel
calls was beginning to approach 500. By 1962 the port was
handling 2,672,897 tons of cargo. In that year, 643 ocean
going vessels called at the port.
In regard to the tonnages listed in Table 18, they
are totals. The figures are not categorized into commodi
ties. Nevertheless, Table 19 gives a categorization into
the various geographical trades. All cargoes, including
river traffic, are included for 1962. Other geographical
trades accounted for less than 100,000 tons in 1962. How
does this compare to the 1930's? The best year of that
decade was 1936. The total tonnage handled for all
facilities was 624,133 tons. Of this, the ocean terminal
facilities moved 411,762 tons. The number of ocean vessel
calls was 224. During 1936 the geographical trades were
272
TABLE 18
CARGO TONNAGE MOVED AND OCEAN VESSEL CALLS,
PORT OF STOCKTON, 1948-1962a
Year
Ocean Terminal
Facilities Only
Direct Calls
Ocean Vessels
1948 . . . ......... 140
1949 . . . . . . . 438,525 " ......... 176
1950 . . . . . . . 757,703 " ......... 258
1951 . . . . . . . 944,608 " ......... 202
1952 . . . . . . .1,277,304 " ......... 278
1953 . . . . . . 1,568,277 " ......... 341
1954 . . . . . . 1,194,602 " ......... 336
1955 . . . . . . 1,333,528 " ......... 333
1956 . . . . . . 2,074,933 " ......... 487
1957 . . . . . . 2,359,068 " ......... 483
1958 . . . . . . 2,326,387 " ......... 527
1959 . . . . . . 2,273,766 " ......... 611
1960 . . . . . . 2,724,095 " . . ... . . 671
1961 . . . . . . 2,662,095 " ......... 617
1962 . . . . . . 2,672,897 " ......... 643
a"Statement Showing Tonnage Handled Thru Port of
Stockton," a pamphlet, p. 2-4.
273
TABLE 19
THE PRINCIPAL GEOGRAPHICAL TRADES FOR THE
PORT OF STOCKTON 1962a
Transpacific ....... 1,214,946 tons of cargo handled
Inland (river traffic) 892,261
European ........... 527,010
Caribbean ......... 168,642
Hawaiian ........... 166,679
Gulf............... 142,252
Coastwise ......... 111,274
TABLE 20
THE PRINCIPAL GEOGRAPHICAL TRADES FOR THE
PORT OF STOCKTON 1936b
Inland 231,077 tons of cargo handled
Atlantic........... 170,797 1 1
Coastwise 142,577 "
European........... 42,279 " " " "
Gulf............... 22,572 "
Transpacific....... 12,856 " " " "
a"Statement Showing Tonnage Handled Thru Port of
Stockton," a pamphlet, p. 4.
t>Ibid.
274
broken into the areas listed in Table 20.
Cargoes moving across the Pacific Ocean have come
to dominate the statistical figures for the port. The
shipment of bulk grains to the recipients of the A.I.D.
program in southeast Asia have accounted for much of the
tonnage. The inland trade ranked high in both decades,
but the cargo was moved by river craft. In 1962 cargo
handled for Europe ranked third in importance. It was
fourth in importance in 1936. Relatively speaking,
Europe's importance to Stockton is about the same today
as it was in the 1930's. The significant change between
the two eras has been the shift from cargoes moving to
other parts of the United States in the 1930's era, to
cargoes moving to world destinations in 1962. Coastwise,
inland and intercoastal trade had accounted for almost
all of the port's business in 1936.
The Port of Stocton in the I960's
Services Rendered to Shipping, Port Personnel, and
Cargo Handling. Pilotage is the first service that a ship
needs in calling at a port. There are eight Stockton
pilots. However, only one of them makes his home in that
275
city. Two tugs are used at the port. There are no immigra
tion officials at the port. However, there are four full
time Customs Inspectors.
Ship chandling, or the supplying of sea stores to
vessels, is done by local firms. However, it is not an
extensive operation because many of the ships come to load
bulk agricultural goods. Modern loading devices handle
these cargoes rapidly. Therefore, a vessel's stay in
Stockton may be measured in hours instead of days.
Consequently, the port's ship chandling service is at a
disadvantage. Most vessels call at San Francisco Bay ports
and obtain stores there.
The superb bunkering facilities of the San Francisco
Bay area have hindered the development of a bunkering
service. Only rarely do ships obtain fuel oil at
Stockton's port. There is little ship repair service
available at Stockton. Local boat works can handle minor
repairs only. Dry docking and major ship repairs must be
undertaken at San Francisco.
The Stockton Port District employs 120 people in
administration and security services. The business of
operating the port itself is a small industry. The new
port administration building is a modern building which the
276
city can be proud of. The longshore industry is an
important element within the port. The number of longshore
men actively employed varies between 400-1,000. The
number fluctuates with the number of vessels visiting the
port. This can vary according to the season. Each crop
in the San Joaquin Valley matures at a different time of
the year. The result is that agricultural industries are
affected by these growing cycles.
Each one of the previously mentioned services is a
function performed by the Port of Stockton. The totality
of these services form a segment of the economic base of
the City of Stockton. The harbor pilot who makes his home
in Stockton, the four U.S. Customs Inspectors, the approxi
mately 10 men who are tugworkers, and the 120 people who
are employed by the harbor department, are actively
engaged in the port's operation. They total about 135.
This being a segment of the base, we can assume that they
will support an equivalent number of service workers or
more, if we are to assume that the base to service ratio
is between 1:1 and 1:2.
The number of men employed in longshoreing varies
greatly over the period of a year. Therefore, it is
difficult to state what number of service workers will be
277
supported by the longshore industry. The number 700 is the
arithmetic mean for yearly employment within the longshore
industry. Taking this, and assuming again that the
economic base to service ratio is between 1:1 and 1:2, it
can be concluded that the service workers supported by
longshoreing will be between 1,000 and 1,200. Assuming a
base ratio of 1:1.5, the 835 workers connected directly
with transshipment would support 1,250 service workers.
Another function must be included. This is the
function of transport from the port to the city and vice
versa. Railroads and trucks perform this task. Any
figures on the number of employees employed directly by
the belt line railroad are misleading, because of the
great amount of cargo transported to and from the port by
trucks. Trucks are continuing to play a more important
role in this connection. In regard to the City of Stockton,
annual rail freight carload movements have declined since
1959, as the following figures testify.
Year Annual Rail Freight Carload Movements
1959 .......................... 66,572
1960 .......................... 63,137
1961 64,557 13
1962 .......................... 63,083
Greater Stockton Chamber of Commerce, "Stockton
Statistical Review," a pamphlet, April 1963.
278
This trend is evident despite the fact population
and business activity have increased. Obtaining figures
on actual man hours employed to haul cargo from various
parts of Stockton or the San Joaquin Valley to the port, is
a problem because of the large number of small independent
truckers. Moreover, many of these trucking firms are not
located in Stockton and therefore would have no effect on
the economic life of the city per se. In regard to this
function, it is difficult to separate transport services
that add to the economic base of Stockton versus transport
services that are part of another area's base.
Cargoes That Pass Through The Port. Agricultural
products account for practically all of the cargo handled
at Stockton's seaport. Unfortunately, as stated, tonnage
figures for the port have not been classified according to
commodities.
(Outbound Cargoes). Bulk grain shipments consti
tute an important element in the tonnage figures for the
port. Rice is an important commodity. The bulk milled
rice facility, opened in 1960, is the only one in the
United States with a capacity of 1 1/2 million bushels of
279
14
rice. There are four 130-foot high silos at the facility
As can be surmised, rice is one of the principal exports to
the Orient. Grain in general, moves to the Orient from
Stockton. In addition, grain is shipped to Europe and the
Caribbean area.
The grain elevator at Stockton, operated by
Stockton Elevators, Inc., has a capacity of 4,500,000
bushels of grain. The elevator's two loading spouts can
load a ship at the rate of 800 tons per hour. Today,
Stockton can boast that it is the second largest dry bulk
cargo port on the Pacific coast. Presently, Stockton
handles approximately 80 per cent of all bulk grain shipped
from California ports.^ This bulk grain originates not
only in the central valley, but comes from western and
middle western states as well. Besides wheat, grains
shipped from the port include barley, milo, alfalfa pellets
corn, safflower seed, oats, and flaxseed.
The shipment of bulk wine is undertaken extensively
at Stockton. The operation is still something of a novelty
United Vintners engage in the transshipment of California
wine to the eastern United States. A tanker, the S.S.
14Ibid. iSjbid,
280
Angelo Petri, has special stainless steel tanks for wine
shipment. The wine reaches Stockton by truck from wineries
located throughout California. At the port, there are 28
stainless steel tanks with a 2 1/2 million gallon capacity.
When the Angelo Petri arrives at Stockton the wine is
pumped aboard through stainless steel pipes. Part of the
load is destined for Chicago via Houston, Texas. The Petri
takes the remainder of the wine to Newark, New Jersey on
the east coast.
Of greater importance to the port but of a more
mundane nature than wine, are both fresh and canned fruits
and vegetables. These are processed in Stockton or at other
points in the central valley. The food processing industry
is an important element in Stockton's economic base. The
important canned commodities shipped are tomatoes, peaches,
apricots, asparagus, beans, figs, pears, and fruit juices.
The fruit products move to the east coast of the United
States, Europe, and Puerto Rico.
Cotton is another export. It is sent to both
Europe and the far east. The source of the cotton is the
southern San Joaquin Valley in the Bakersfield area. There
is a special facility at the port for compressing the
cotton. There are 300,000 square feet of special area for
cotton storage. Thirty thousand bales of cotton may be
stored.
Ore is an important export. The bulk ore comes
from Nevada, Utah, Oregon, and California. The ore
facility is rated as the fastest one on the west coast.
Two ships may be accommodated at the facility and may be
loaded at the rate of 2,000 tons per hour. Toward the end
of 1963 the bulk ore terminal handled a record shipment
within a ten day period. Ten ships came to the facility
and 158,337 tons of cargo were moved. A record shipment
of petroleum coke amounting to 22,064 short tons, was
loaded aboard one ship, the S. S. Delphic Sky. Table 21
lists the ships visiting the port during this period.
A new bulk item is now being shipped into the port
It is phosphate rock. According to one of the central
valley's newspapers, a $180,970 contract for converting
the old grain terminal at the Port of Stockton into a bulk
phosphate rock facility was awarded to the Modern Engineer
16
ing and Construction Company. The phosphate rock will
be ground into fertilizer material in the Best Fertilizer
Company plant at Lathrop in San Joaquin County. The same
^Sacramento Bee, December 18, 1963, p. C-2.
282
TABLE 21
RECORD BREAKING CARGO MOVEMENTS FOR A TEN-DAY PERIOD
FALL OF 1963, PORT OF STOCKTON a
Ships Tons Product
Delphic Sky 22,064 loaded petroleum coke
Anna C 11,870
11 ii ii
Dora Maru 11,029
11 ii ti
Sumahara Maru 23,299
11
iron ore
Avgi 16,387
11 it it
Numerian 16,278
11 ii ii
Fuyo Maru 3,856
IV ii ii
ii it
2,242
It
alumina silica
Kokusai 14,036
II
mill scale
Esso Newark 19,166 discharged jet fuel
Chepachet 18,108
II it n
aTldeways, Vol. 12, No. 9, Nov. 1963, p. 3.
283
vessel, the Marine Rice Queen, which hauls rice from
Sacramento to Puerto Rico, will bring the phosphate rock
from Tampa, Florida on its return trip to California. This
ship will be able to haul 116,000 tons of phosphate rock a
year. The Marine Rice Queen was scheduled to bring the
first load of phosphate rock to Stockton during the middle
of March.
Logs also form a part of outbound cargoes. They
are cut in the foothills of the Sierra Nevada Mountains
and shipped to Japan and Korea. Another bulky item shipped
from Stockton, are large diameter steel pipes. Some
machinery is shipped also from the port.
(Inbound Cargoes). Inbound cargo comes from many
parts of the world. Much of it is agricultural in nature.
Some manufactured goods enter the port also. Among the
manufactured articles are plywood, steel, sewing machines,
and cotton shirts from Japan. Steel and manufactured
articles come from Europe also. Tonnages of manufactured
imports are not large. Compared to the outbound tonnages
of agricultural goods, manufactured articles are but a
small segment of total tonnage handled. Raw materials,
imports for the valley's agricultural needs, are channeled
through this port. Tonnagewise, one of the most important
284
is fishmeal from Peru and Chile. Soil nutrients from
Norway are another item.
Molasses is imported as well. The Pacific Molasses
Company has three separate bulk molasses facilities at
portside. Inbound shipments come from Formosa, the
Philippines, and Hawaii. Another bulk commodity, handled
at the port is petroleum. Jet fuel is important. The jet
fuel is piped between Stockton and Air Force bases in the
central valley. The petroleum movement is not connected
with the ocean port. Rather petroleum moves by barge from
the San Francisco Bay area to Stockton, where it is
distributed to inland ports.
Stockton has a new system for handling general
cargo. It offers an "all inclusive rate'1 for warehousing
and distribution of imported packaged articles.^ included
in the plan is warehousing up to 120 days, all necessary
paper work, and daily warehouse inventory control. More
over, the shipper is advised of his costs four months in
advance. Mr. Graham E. Frost states that, "Ours is the
only port on the west coast offering such special distri-
18
bution and warehousing of imports." Presently, most of
^ Tideways, Vol. 12, No. 9, Nov. 1963, pp. 10-11.
18ibid. p. 10.
285
the merchandise that is being handled by the "one price
package plan," originates in the transpacific area.
Products which have come under the plan include shirts,
slacks, bamboo furniture, rugs, earthenware, sporting goods,
radios, tape recorders, bicycles, motorcycles, and flowers.
Under the distribution plan, shipments from port
warehouses may be distributed to different sections of the
United States at different time periods. The "all inclu
sive rate" is applicable to shipments that are on their way
to their final destinations in one shipment or in several
shipments. The heart of the new system is a battery of
electronic processing machines made by Remington-Rand
Company. Inventory control is maintained by the computers.
Port officials feel that this will enhance the Port of
Stockton’s competitive position. Despite advances made in
general cargo movements, the port still remains essentially
an exporter of agricultural produce. Bulk commodities
comprise the important export shipments and the important
import shipments.
The port can boast of another record achieved
toward the end of 1963. Ten ships visited the port in a
single day. Moreover, 60,000 tons of cargo were handled
by these vessels. At the same time, but over a six-day
286
period, 21 vessels visited the port. Nearly 100,000 tons
of cargo were handled. This six day period was one of the
19
busiest in the port's history. During the 1960's, the
Fort of Stockton has assumed a significant role as a
transshipper of cargo. Bulk commodities, which can be
handled by automatic loading equipment, constitute most of
the cargo moved. General cargo has yet to reach a
significant level.
The above activity described in regard to the port
is an excellent indication of the economic vitality of
California's great central valley. It is an economic
region that at present is dominated by agriculture. Every
town and city with the possible exception of Sacramento
owes its economic life to agriculture. Likewise, the Port
of Stockton serves the needs of an agricultural area in
its transshipment function.
IV. THE FAILURE OF ST0CKT0N''S PORT TO CREATE
INDUSTRIALIZATION
Present Industrial Status of The Port
The question might be asked as to what industries
^Ibid. , p. 3.
287
have located at the port. Has the seaport attracted
industry since its inception in 1933? If we are to draw
a conclusion based on our previous reasoning, we would
conclude that it had. Unfortunately, this has not been
the case.
The new industrial additions to Stockton that
intend to use the port have been very recent. Can the
molasses facility at the port be included? The answer is
"No," for this is not true manufacturing. It is simply a
terminal for the receipt of the molasses. It is shipped
to other points for processing. The same thing can be
said for the wine facility. The wine terminal is a trans
shipment point for shipping California wine to the east
coast.
There is a firm, however, located at port side that
can be included within manufacturing. It is McCormack and
Baxter Creosoting Company. Logs come down the river to
Stockton from the Sierra Nevada Mountains. Here they can
be transshipped to many destinations. Creosoting is done
at the port. However, even though logs may move in ocean
shipments, creosoted ones seldom do. Therefore, creosoting,
a part of Stockton river port activity, is not connected
with the ocean port.
288
There is an industrial park at the Port of Stockton.
However, it is of fairly recent origin. Established in
1957, it is open to light, medium, and heavy industry.
Presently, there is only one firm in the industrial park.
It is the H. H. Robertson Company, a maker of steel
structural panels and steel decking, that has located in
the Port of Stockton in order to make use of imported steel.
One industry typical of large ports, is shipbuild
ing and ship repair. This has not developed. Local boat
works are considered to be a part of the port's industry.
However, these boatworks have no connection with the ocean
port. Rather, they are in existence because Stockton is
located near the large delta area for the San Joaquin and
Sacramento Rivers. The delta area has been compared to the
Everglades of Florida in regard to size. Local boatworks
are oriented to delta activities.
A research institute has located at the Port of
Stockton. The Aquatic Research Institute, the only private
organization in the world devoted to the development of the
aquatic sciences and fisheries in the Asian and tropical
western Pacific Ocean area, placed its facility at the Port
of Stockton. The institute's desire to be near the San
Joaquin-Sacramento Rivers delta region was the principal
289
reason for its location at this port. Among other loca
tional factors was the port itself. Here supplies and
collections to and from the western and tropical Pacific
Ocean, may be brought by ship to the front door of the
institute.
Recently, two firms have located at Stockton
because of the port's presence. Neither of these are
located at portside or within the port's industrial park.
The Manufacturers Mirror and Glass Company is one. It
found a Stockton location suitable because it is planning
to import glass from Belgium and from Japan. The second
firm, the Laidlaw Wire Company found Stockton suitable
because it can import wire from Japan. Both firms are new
arrivals at Stockton and will undergo future expansion of
their facilities. In addition to the commercial establish
ments, some of the military bases also rely on Stockton's
port.
Why The Port Failed to Generate an Industrial Milieu
The manufacturing and technical firms locating
within Stockton because of the seaport, can be numbered
by the fingers on one hand. Why did the port fail to
attract more? In reviewing the history of the port, the
290
first thing that comes to mind is the fact that the seaport
was opened for business in 1933. A worse time could not be
imagined. The depression's severity at that time precludes
any thought that business expansion would take place after
the port's opening. Worse still, the depression continued
until the Second World War. As previous figures testify,
the port did generate business during the thirties.
However, this business was involved with the transshipment
function alone.
The Second World War followed the depression.
After this there was a period of readjustment following
the war, and then the first post war recession of 1949.
As can be seen, forces exogenous to Stockton's economy were
very adverse to any significant growth that the port might
have created for Stockton. However, since the Korean War
the situation is very different. Business, especially
during the mid-1950's, has been excellent.
In fairness to the port, a proper evaluation con
cerning its effect, not only on transshipment firms but on
industry and economic development in general, must exclude
the era between the seaport1s opening and the Korean War.
Judgment must be based on the decade of the 1950's and the
early years of the 1960's. During this period, the port
291
has hit its stride as a transshipper of bulk cargoes.
General cargo is playing an increasingly important role.
However, the port has not become an industrial port. A
number of factors account for this.
The most important reason for the failure of the
port to generate industrial activity is the lack of a
market. The population of the Stockton urbanized area in
1950 was 112,834. There was a marked increase to 141,604
in 1960. The small market that has characterized the
Stockton area, has hindered growth. The central valley as
a whole provides a market. Again, however, the market is
not large. The valley includes small towns and farms.
Many industries that might feel an orientation toward the
central valley would choose Sacramento because it is much
bigger. They would favor Sacramento, even if they did not
need a port location.
The second most important factor in the retardation
of industrial growth is the presence of San Francisco and
the Bay area communities. The agglomerative pull of the
San Francisco region on new industrial ventures and popula
tion has meant that any new industries desiring a northern
California location, will bypass Stockton and its port in
favor of San Francisco with its superb port, powerful
292
market, and its financial power. This has been a factor
in the past. Can Stockton, and for that matter Sacramento,
overcome this influence? In considering the future growth
of California, the inference may be drawn that it can.
Therefore, the question remains as to what extent Stockton
can overcome the Bay area's magnetic pull.
The third reason that Stockton's port has not had
a more powerful influence on industrial expansion is the
time period. From the historical point of view, the era
before the Korean conflict ought to be excluded because
there were too many adverse factors. Therefore, we have a
relatively short period, a period of less than 15 years,
in which to pass judgment on the Port of Stockton's indus
trial generating power. However, within this period, a
few manufacturing firms have decided on a Stockton port
location.
A fourth reason for the lack of the industrial
growth that we might expect, is closely associated with the
lack of markets problem, caused by a lack of metropolitan
areas in the western United States. The largest metro
politan areas are seaports along the Pacific Ocean coast
line. Sacramento is close but until recently has been
only a small city. Besides California, the western states
293
have meager populations. This is adverse to Stockton's
ability to attract industry and population. The only
practical markets for its possible industrial products are
the San Francisco and Los Angeles metropolitan areas.
These areas have seaports. Consequently, Stockton's port
does not offer an attractive site for a port-oriented
industry desiring to market its products in either
San Francisco or Los Angeles.
The fifth and last reason for the lack of indus
trial growth is the inertia of the local community. It
seems that the business community does not realize fully
the potential economic power of the port. Evidence of this
is noted by the late date for the establishment of an
industrial park at the port. It was laid out in 1957, 24
years after the port's establishment. Certainly, the local
community could have done better than this. Even to this
day there are large tracts of unoccupied land very near the
port. Perhaps, if Stockton had a Chamber of Commerce with
the drive that has always been characteristic of the
Chamber of Commerce in Los Angeles, better results could
have been achieved.
Creating good conditions for industrial growth is
one thing. Nevertheless, creating a willingness to choose
294
one city among many on the part of industry is quite
another. Many conditions for favorable growth were present
after the opening of the port. It seems that community
attitudes could have been better in order to create a
willingness on the part of industry to locate there.
The Future
A cloud has passed over Stockton in regard to its
industrial future. Sacramento now has the advantage of a
seaport, a facility formerly enjoyed by only one city in
the central valley, namely Stockton. In addition,
Sacramento offers more to a rewcomer, whether an industrial
firm or an individual, than Ltockton does. First, there
is a larger population and market area at Sacramento.
Moreover, Sacramento has the prestige that goes with being
the seat of a political capital, namely California's
capital city. Furthermore, Sacramento has an aggressive
Chamber of Commerce. As an example, seminars were insti
tuted at Sacramento State College in order to stimulate the
foreign trade activities of the port. The Port of Sacra
mento, the Sacramento Chamber of Commerce, and the World
Affairs Council of Sacramento, sponsored the series of
five import-export trade workshops that began April 8, 1964.
295
The seminars were directed by Dr. Roesti of the state
college. The topics covered were, "The Export Challenge,"
"Breaking Into Export," "The Role of International Banking,"
"Freight Forwarding and Export Insurance," and "Export
Aids Available." The enrollment in the seminars has been
20
limited to 20 people. In general, the state capital
offers favorable inducements to attract new firms for
future industrial growth. Stockton does not offer as much.
Another problem faced by Stockton is that many of
the products passing through the port go to other towns in
order to be processed into the final product. An example
of this is the new shipments of phosphate rock that pass
through Stockton on their way to a smaller community in
San Joaquin County. If Stockton could induce firms shipping
products through the port to complete the production
process in Stockton, it would be a desirable change for
the city.
Favorable indicators for Stockton are projected
growth rates for San Joaquin County and the State of
California as a whole. Moreover, assuming that Sacramento
20"Sacramento Trade Workshops," Pacific Shipper
Vol. 35, No. 5, March 23, 1964, p. 37.
296
steps up its rate of growth, it may mean industrial develop
ment for the region comprising the lower reaches of the
Sacramento and San Joaquin Rivers, and the central portion
of the central valley as well. The two cities, Sacramento
and Stockton, may share eventually the division of a future
industrial metropolitan district. However, indications
are that Sacramento will be the leader and Stockton the
follower in such a game.
Sacramento may well capture some of Stockton's
transshipment business. It has been reported, as of the
first of this year, that some of the agricultural cargoes
that moved through Stockton in the past are passing now
through Sacramento. This is inevitable and Stockton can
do little to stop this trend. Sacramento will capture
permanently some of the cargo that has gone through
Stockton. Stockton may have lost the golden opportunity to
attract port-oriented industries during the 1950's. The
opportunities are no longer golden. Now the city faces
a serious competitor.
CHAPTER VIII
CONCLUSIONS
I. CAN A COMPARISON BE DRAWN BETWEEN THE PRESENT
STUDY AND OTHER PORT CITIES?
The question may arise could other port cities
have been included within this study? Yes, any transship
ment point could have been compared to America's western
cities. However, this has been basically a study of new
port cities in western America. Consequently, many port
cities other areas have been bypassed. The cities,
outsidt. ne western United States, which have been
reviewed, were discussed in order to show the historical
growth of the transshipment point through different
histor^ jI economic periods.
rhere are several modern ports which may have
deserve^ mentioning. Undoubtedly the most relevant one
for this study is Houston, Texas. The Houston Ship Canal
of 58.5 miles length was constructed in 1914. Consequently
Houston became an ocean port, and the old port of Galveston
was bypassed. Houston, located in an area of rich natural
297
298
resources, is at present an important industrial city.
Petroleum replaced cotton as being the leading industry
before the Second World War. The city is the center of
the Texas oil industry. The Houston Ship Canal at present
is lined with oil refineries and petro-chemical firms. In
1962 the population of the Houston Statistical Metropolitan
Area stood at 1,300,000. In addition, there were 1,603
manufacturing plants employing 56,187 workers.^-
Let it be conceded that the ship canal has and
still does play an important role in Houston's economic
development. However, certainly no less important is the
role petroleum plays. The presence of oil in the area has
been of such vital magnitude that economic development in
the Houston-Galveston area would have taken place without
any canal. However, the ship channel did work to create
development in Houston itself as well as along the ship
canal rather than at Galveston or at some other point on
Galveston Bay. The ship canal guaranteed importance to
Houston instead of Galveston.
Manchester, England is another important industrial
^ • Rand McNally Commercial Atlas and Marketing Guide,
94th ed., 1963, pp. 242-43.
299
center, which is an inland seaport created by a ship canal.
However, this example is not too pertinent for the study.
Manchester was a booming industrial community when the
Manchester Ship Canal was opened. Originally, Liverpool
had been the port city for Manchester. At the time of the
canal's opening, both cities were mature industrial centers.
The influence of the ship canal has been to increase the
relative importance of Manchester. However, it was not the
factor that induced industrialization and economic
development in general.
An example of a port city which has been a failure
is Prince Rupert, British Columbia, although its developers
had great expectations for it. Its failure is due largely
because it hasf been excluded from large-scale Alaskan trade
by the close Alaskan and continental United States trade
relationship. Moreover, it is located in an underdeveloped
area of Canada. Furthermore, it can not hope to compete
with Vancouver, B. C., a port city with excellent rail
connections with eastern Canada. As well as the large
western North American port cities, there are also the
small ports. These small ports may have a few wharfs and
little else. All are associated with the export of a single
raw material or product. Lumber and paper are small port
300
exports in the Pacific Northwest.
California is a state with very large ports. The
new Port of Long Beach attempts, and has been successful in
attempting, to create the image that it is both unique
and also distinct from the Port of Los Angeles. Neverthe
less, the two ports are basically one entity from the
economic viewpoint, although it is true there is a political
division between them. Both ports serve the Los Angeles
metropolitan area, and both have the same hinterland.
Little has been said in this paper on hinterlands.
The primary reason for this results from the fact that the
study is concerned with a city's economic development, as
opposed to regional development. The second reason for
this neglect is the problem of the overlapping of hinter
lands, arising because each city has a multitude of hinter
lands. A theoretical discussion on the multitude of hin
terlands has been developed by August Loesch. For each
good there is a "wide-meshed net of hexagons." A multitude
of goods means a multitude of "wide-meshed nets of hexagons1 . '
o
Each net has one common center which is a city.
^Loesch, August, The Economics of Location, (New
Haven, Connecticut: Yale University Press, 1954),pp. 124-
137.
301
A multitude of hinterlands arises because Individual
products produced by a city or attracted to the city have a
hinterland which is distinct from the hinterlands of other
commodities. For instance, the hinterland for the receipt
of grain at the Port of Long Beach's new grain terminal
embraces not only the west but the middle west as well.
However, the Port of Long Beach's hinterland for the
receipt of citrus fruit would be limited to southern
California and Arizona. In the case of grain, there would
be an overlapping of port hinterlands. However, this is no
problem in regard to citrus fruit. Consequently, the
hinterland problem is more complex than one would imagine.
II. NEW PORT CITIES AND THEIR EFFECT
ON ECONOMIC DEVELOPMENT
A Powerful Influence
Each heyday of a particular form of transport has
created its own transshipment points, points at which
cities developed. When new forms of transport evolved,
some of these cities fell into oblivion. Others attained
sufficient importance to force the new form of transport
to conform to the old transport nodal points. Cities in
the near east, middle east, and central Asia, that once
302
owed their greatness to the fact that they were transship
ment points in the system of camel caravan transport, have
declined in importance, to be replaced by cities that are
transshipment points in the modern transport network, a
network geared to railroads and steamships. In the far
east, the great cities of the ancient orient are of
secondary importance to modern commercial entrepots that
carry on world trade with ships. Examples are many.
Ancient Delhi lost its importance to modern Calcutta, a
seaport. The modern seaports of Singapore, Hong Kong, and
Shanghai far overshadow China's capital city of Peiping.
Today, Tamerlane's ancient capital city of Samarkand in
central Asia is all but forgotten. However, at one time
it was an important entrepot.
As this paper has discussed time and time again,
the establishment of a transshipment point is a powerful
lever in inducing economic development. Specifically, this
applies to the growth of a city. The transshipment function
which all seaports perform, creates growth per se. Being
a terminus for various means of transport, the transship
ment point is either a final or an intermediate goal for
travelers. It is a resting spot for those workers engaged
in transport industries. This creates the necessity for
303
the transport workers and travelers to remain at the
transshipment point for either a short or -a longer period
of time. A demand for housing, either short-term or long
term, is inevitable. The supplying of food is also a
necessity. Besides travelers and transport workers, a
labor force must be present in order to move the goods
being shipped from one form of transport to another. A
further necessity is the establishment of a local govern
ment for the maintenance of law and order, or a minimum of
law and order. Thus a simple economy is a natural con
sequence resulting from the transshipment point.
If the transshipment point develops in size, a
myriad of activities connected directly with the transship
ment function will arise. Service activities will increase
for the resident population and travelers alike. The
traveler will find more to satisfy his desires than a local
inn, supplying both lodging and meals could give him. Now
he may desire to tarry for a day in order to indulge in the
communities activities, instead of moving on immediately.
The transshipment point draws transport-oriented
industries to the site because transport service is avail
able to other areas. Moreover, by working up products at
the transshipment point, one step in the movement of goods
304
can be eliminated in goods handling. This is the step of
reloading the raw material or intermediate products onto
another means of transport, in order to move these items
further along the main route of travel to a community,
where the factory could be located. At the transport
center, final goods may be created and then sent on to
their final destination.
A source of labor will be found at these nodes in
the transport network. Labor is present in order to supply
the transport function and also the city's service indus
tries. The city's terminal status for various means of
transport make it a focal point for unemployed labor. If
employment is unavailable here, the unemployed workers may
move easily to other areas.
Market-oriented industries have steadily become
the most prevalent of all firms. Numerous studies support
this contention. Most businesses regard the present market
and the availability of future markets to be their most
important reasons for location. Even with the simple
transport node, there will be a small market. As transport
activities increase, the market will expand thus making
the site of transshipment even more attractive to industry.
With the transshipment function present, along with
305
a tendency on the part of industry to agglomerate, another
important economic factor will enter the picture in order
to induce greater growth, namely, external economies.
Moreover, linkages, both backward and forward, between
industries are vital in the chain of economic production.
The establishment of one new firm brings the possibility of
attracting other firms, resulting from essential linkages.
The old saying that "nothing succeeds like success,"
is true of cities as well as individuals. From a modest
beginning in transport, a city may at first attract a few
firms that are oriented directly to the transshipment
function. As a consequence, the city will attract other
industries because of the above named factors. The result
will be a highly diversified industrial complex.
The port, especially the seaport, is the transport
node or transshipment point, par excellence. Its power of
industrial generation is great. First, in order to be a
seaport, large quantities of cargo must pass through it.
The construction and maintenance of a commercial port
involves large outlays of expenditures. The maintenance
and supplying of the ships is a large undertaking. A
modern port is a transport and communications hub for its
region. All of the reasons given for the transshipment
306
point's inducement of industrial growth are applicable to
the seaport. In addition, the seaport can create the magic
of growth, because it is on a broad highway, the broadest
highway in the world, the world's oceans. It is a highway
leading to the largest world cities, a highway leading to
all developed nations, and a highway leading to all conti
nents. The seaport faces the world and the world's
activities. The hinterland is exactly that. It is the
area lying in back of the city, while the city itself looks
outward upon the world.
Criticisms Leveled at Sacramento's Port
In the case of Sacramento and Stockton it is
believed that the expenditures by the federal and local
governments were justified. The port of Stockton has
developed a vigorous transshipment industry and has lured
some industries to it. The port of Sacramento is too new
to justify expenditures on the basis of revenue. However,
the Army Corps of Engineers has estimated the benefit to
cost ratio to be 2.2 to 1.0.^
3
W. G. Stone, "Brief History of The Sacramento
River Deep Water Channel Project," a pamphlet, (Port of
Sacramento),p. 3.
307
There is also the charge that the Sacramento ship
canal and the port represents "pork barrel legislation."
This charge was hurled at Sacramento in an issue of a
leading national magazine last year. Such charges have no
justification. The only evidence that can be introduced
in order to prove that it is a "pork barrel project" is
the total co.it. Yet this is a poor manner in which to
prove an argument. The Army Engineers conducted a number
of studies over a period of years. Their final conclusion
is that the project was worthwhile. In addition to the
Corps report, the Grunsky Report, as early as 1925, also
recommended the project. Why should this project be
labeled derisively as "pork barrel?" The charge stems from
a criticism of government spending in general and not from
this particular project. It is either this or the charge
comes from San Francisco business interests who stand to
lose a certain amount of business to Sacramento.
Another charge leveled at the port is that it is
too far from the sea. However, this argument is meaning
less. Many of the world's ports are situated far from the
sea, to which Table 22 testifies. The figures in Table 22
should dispel doubts about the Port of Sacramento, or for
that matter, the Port of Stockton, from being too far from
308
TABLE 22
DISTANCES FROM THE SEA OF SOME IMPORTANT
WORLD PORTS
Miles
Sacramento 111 from the Pacific Ocean
Baltimore 151 " Hampton Roads
Portland, Oregon 112 " the Pacific Ocean
Philadelphia 105 " Delaware Bay
London 67 " the North Sea
Hamburg 67 " the North Sea
Manchester, England 55 " the Irish Sea
Bremen 54 M the North Sea
Antwerp 50 " the North Sea
Houston, Texas 50 1 1 Gulf of Mexico
309
the ocean.
Another charge is that Sacramento, which was
established as a seaport long after the opening of
Stockton's ocean port, is too close to Stockton. Is there
justification for two seaports within such close range? It
is true, both cities serve California's great central
valley. However, the justification for a seaport is the
amount of business it will do, not its proximity to
another port. Moreover, Sacramento has served tradition
ally the Sacramento Valley or the northern portion of the
great central valley. Stockton has been a service center
for the San Joaquin Valley, or the southern portion of the
central valley. Consequently, the two cities are economic
ally separate entities, each serving a different region.
The fact that the central valley is one geographi
cal entity does not mean that it must be one economic
entity, with one single important city. In the first place,
the central valley is a huge area covering about 18,000
square miles. Therefore, dual facilities do not violate
the concept of efficiency, as it might for a much smaller
area. Additional terminal facilities may lend greater
efficiency. One of America's leading railroad entrepre
neurs formulated a principle in this regard. James J. Hill
310
said in speaking about the amount of freight a railroad
line could carry, "The volume of traffic a line could
carry could not exceed the capacity of the terminals."^
Speaking of the problem of terminal facilities, the Wall
Street Journal in early 1964 reported that ships are
clogging U. S. ports because of wheat sales.^ This addi
tional movement of wheat abroad can be used also as a
justification for dual port facilities in the central valley
There is also a national defense argument for
Sacramento's seaport. In case leading U. S. ports were
damaged badly during a war, the smaller ports would have to
be relied on in order to relieve bottlenecks in shipping
goods to overseas destinations. In addition to the above
reasons, the future growth of California justifies the
seaport as well.
Will Sacramento or Stockton's Port Lead to A Future
Metropolitan District Similar to America1s Largest Cities?
The prerequisites for a great city are present for
either Sacramento or Stockton. In this study, we have
^■Roy S. MacElwee, Ports And Terminal Facilities,
(New York: McGraw-Hill Book Company, Inc., 1918), p. 2.
^Wall Street Journal, January 20, 1964, p. 16.
311
analyzed the development of cities from the initial growth,
a growth stimulated by the transfer of goods . The fact
that this transshipment function is a powerful growth
factor has been well documented here. Both Sacramento and
Stockton are endowed with this particular function. In
addition, each is located within a rich agricultural
region. Furthermore, the market within the region is
growing. Incomes are high for California farmers.
Sacramento itself presents an attractive market;as compared
to national averages, its income is high. Furthermore,
the population of Sacramento is pushing the 600,000 mark.
Transport-oriented industries, market-oriented industries,
and labor-oriented industries can all find justification
for a Sacramento location. Likewise, a Stockton location
would be attractive.
In regard to raw-material-oriented industries the
case is not as strong unless such industries rely upon
agricultural raw materials. Estimates for the canning
industry and packaged foods industry all predict increasing
demand for output in these categories. In order to take
care of this trend increasing plant expansion will take
place in Sacramento and Stockton. Raw-materials-oriented
industries that rely upon lumber will find either a
312
Sacramento or a Stockton location convenient because of
the nearness of stands of timber in the Sierra Nevada
Mountains. Paper and allied products would find Sacramento
convenient because of the nearness of large tracts of
timber.
There is a possibility that a steel plant might
find a convenient location on the Sacramento or possibly
Stockton ship canal. A seaboard location is essential for
such an undertaking in this day, because of the reliance
on imported ores. The introduction of steel manufactures
and also petroleum refining, which could give rise to the
petro-chemical industry, would mean heavy industry for the
region. Such an eventuality would produce a full-fledged
industrial district. This would mean a large metropolis
in the central valley.
Sacramento stands a better chance to become a
metropolis than Stockton does. As was mentioned before,
it is bigger and has prestige from being the state capital,
along with a desire to grow and to improve itself. There
is no reason why Sacramento cannot attain metropolitan
stature. Certainly of great advantage is the new seaport.
It is now a city on the world's shipping lanes. The ques
tion might be asked as to whether Sacramento could equal
313
the San Francisco or the Los Angeles metropolitan areas.
Such a thing is unlikely within the next 100 years. All
predictions for economic growth for these two metropolitan
districts show substantial increases. Even if Sacramento
can achieve a more rapid growth rate than either Los
Angeles or San Francisco, it cannot hope to overtake them
for the industrial and population base is small compared
to the two big cities. Even with a smaller growth rate,
the two western metropolises' growth in absolute terms
would continually keep them ahead of Sacramento with a
higher growth rate and correspondingly smaller absolute
increases.
Will Sacramento, because of its port, attract
industry that might have gone originally to San Francisco
or Los Angeles? If so, can this be said to be desirable
for San Francisco or Los Angeles? Is it desirable for them
to lose potential newcomers to Sacramento or Stockton? The
answer is that it is, because growth for the two metro
polises is assured. The problem with too rapid a growth
rate is that public services lag behind private development
schemes. Moreover, city planning is better with a slower
rate of growth. The conclusion is that San Francisco and
Los Angeles would be benefited, providing that some of the
314
potential growth were shifted to the central valley cities.
Slower growth would mean that public services could keep
up with demand in the very large metropolises. The State
of California and the west as well would derive benefit by
the creation of new metropolises, instead of the continual
expansion of the old ones.
III. CAN THE PRESENT UNDERDEVELOPED COUNTRIES LEARN
A LESSON FROM THIS STUDY?
Present underdeveloped nations can draw some con
clusions from this study. First, in speaking of economic
development the underdeveloped nations refer primarily to
industrial development. Technical advance in agriculture,
which has as its goal an agricultural surplus, is often
given priority. This results from the fact that a surplus
in agriculture can be sold abroad for foreign exchange and
may be used to feed city workers. The goal in obtaining
the foreign exchange is to import machinery for manufac
turing enterprise. Basically, the whole question of
economic development revolves around the problem of
industrialization.
The economic histories of the developed nations
have demonstrated repeatedly that manufacturing concerns,
315
and firms engaging in finance and trade, will agglomerate
at cities. Therefore, an understanding of a city's eco
nomic development is very helpful in attempting to under
stand both regional and national economic development.
This study has attempted to analyze the growth of a city
in relation to one economic function, namely transshipment.
The aspect of city growth has been neglected in the field
of economic development. Therefore, it is felt that under
developed nations may obtain a better insight into their
problems from this study.
Another aspect for consideration is that the
industrial city is a great Europeanizing force in the
world’s underdeveloped nations. The present industrial
cities within the backward nations attract new labor from
the rural areas, areas that are dominated by the older
culture. The city is the school that teaches the newcomers
western industrial technique and also western cultural
ideas. The traditionalists within the lesser developed
nations have reason to fear the western oriented cities.
However, those thinkers who place economic development above
the traditional values must welcome the burgeoning cities,
though they may create social problems, such as crime and
slums.
316
The thinkers concerned with economic development
must accept the European entrepot cities which may have
changed hands politically, but are still dominated by
European and American business interests. These big cities
are the principle areas of economic development. Though
economists may spend a good deal of time in discussing
rural problems, political stability, education, and social
overhead capital, the fact remains that the most important
arena for economic change is the modern city. The business
men who control the economic life of the city exert an
influence on the whole national life. In attempting to
attain an egalitarian economic society, the land monopoly
problem is continually attacked. Even when the land
problem has been solved, as it was in Mexico after the 1910
revolution, economic egalitarianism was never achieved.
For with the industrial growth which goes hand in hand with
economic development, the capitalistic entrepreneurs gain
economic control of the society by controlling industrial
development. The economic reformers often achieve some
equality in the rural sector of society, but usually fail
in the developing industrial sector because the forces of
capitalistic development are too powerful.
In those nations that have adopted socialism this
317
would not be the case, quite naturally. If development Is
to proceed via capitalism, the modem city must be encour
aged to grow. However, encouragement may not be necessary,
for it will occur rapidly with capitalism. However, for
those desiring control over capitalism, controls must be
fashioned in accord with city development. Moreover, city-
oriented people must be in control of the developmental
process if development is to proceed fast, and if the
social and economic evils usually associated with large
cities are to be lessened.
Many underdeveloped nations, notably those in Latin
America, have an inordinate fear of the rapidly developing
cities. They prefer to spend scarce foreign exchange in
the development of some rural area instead of on their
cities. Brazil and Argentina are extreme cases in regard
to this philosophy. In Argentina the developmentalists
view with horror rapidly growing Buenos Aires. They are
alarmed by the fact that immigrants are content to stay in
Buenos Air As instead of moving on to establish farms in the
Argentine back country. In Brazil the same feeling is
prevalent. Both Brazilian and North American planners are
upset by overcrowded Rio de Janeiro. Their only solution
is to send many of Rio's inhabitants into Brazil's
318
underdeveloped Interior. However, where are these people
to go in the interior? The answer to this is usually
vague, just somewhere away from the large cities. This
philosophy has gone so far in Brazil that it is one of the
reasons for the placement of Brazil's new capital city,
Brasilia, in the interior of the country. The capital,
according to the planners, is going to lure people into
the interior of the country.
There is some justification for the above thinking.
Certainly, much good will result from channeling funds
into the country's interior. The argument presented here
is that the same funds would reap greater developmental
rewards if spent on the cities. For it is in the cities
where the people live. Funds could be spent within the
city on transport services, education, public health, and
on many of the slum areas. Moreover, funds must be
expended on attracting new industries and in alleviating
social costs created by industry.
One might ask, but what about the economy's rural
sector? Of course, some funds should be spent on rural
development, but less attention should be given this area
319
than in the past. By spending developmental funds primarily
on the cities, agricultural production will increase. The
method most compatible with the theory here presented, is
to allow the market mechanism to bring about increased
agricultural production. Our line of reasoning follows
the Ricardian Rent Theory. Along with the cities' increas
ing population will go an increasing demand for food. In
turn, agricultural prices will tend to advance, which will
mean that rural land rent will increase. As this happens,
new lands will be opened to agricultural production. As
the process continues, government must see to it that there
are adequate transport services between the cities and the
rural areas in order to insure maximum agricultural
production.
The chief criticism of the above reasoning is that
foreign exchange will be jeopardized by not placing
developmental funds into the agricultural sector, a sector
that may be devoted largely to primary raw materials
production. Certainly, this point can be conceded. The
raw materials producers rely on their primary products
exports for their foreign earnings. What must be consid
ered here is the degree of development. Those poor nations
with very small cities will reap the greatest benefits by
320
placing developmental funds into the export sector in order
to earn foreign exchange. Nations as poor as this, notably
the African countries, are but one type of underdevelopment.
Most underdeveloped nations fall into the category
of intermediate development. In this case, large or
medium-sized cities have developed. Moreover, there is
already some industrial development. Most of the Latin
American republics fall into this category, as well as
most Asian nations. Consequently, it is felt that the
reasoning advanced in this study is valid. It is a valid
conclusion for all underdeveloped nations, except the
most backward.
In regard to foreign exchange earnings, it must be
remembered that as cities grow and industrialization
proceeds, the nation will not be as reliant upon foreign
exchange as it was in the initial stages of development.
Now the nation can produce many of the articles that it
formerly imported. However, it must be conceded that the
problem of foreign exchange has been, and always will be
a problem for the developing nations, because new projects,
which they feel are necessary, require importation of
foreign industrial equipment. Obtaining foreign exchange,
either by exportation or by loans or grants, provides funds
321
for these new projects. However, completion of one project
or goal often means that a new project is pushed into the
limelight as being a necessity. The result of this
process is that the underdeveloped countries' demand for
foreign exchange is insatiable. The primary factor working
against this process is an educational level of the popula
tion so low that the lack of trained manpower limits the
whole development process.
IV. FINAL CONCLUSIONS
Economic Development Must Proceed Via Excess Capacity In
Transport
Now the question, must all sectors of the economy
grow at the same rate? Is the balanced approach to
economic development the most sensible? This approach has
been widely accepted by economists. According to this
theory, developmental capital must be put into the full
spectrum of economic activities. The goal is to induce
agriculture and manufacturing to grow at the same pace., A
balance would be maintained, likewise, between social over
head capital, meaning investment in education, public
health services, public utilities, and transportation, and
indirectly productive activities or manufacturing.
322
It is felt that a balance must be maintained, for
if one sector would grow faster than other sectors, then
the slower sectors could neither absorb the added produc
tion of the more advanced sector nor supply it with raw
materials needed in production. The consequence is that
the growth of the advanced sector would be retarded. Also,
if one sector is allowed to lag too far behind, it will
act as a drag on the whole economy.
Those in favor of balanced development are believ
ers in what has been termed the "big push," the goal being
to provide an "enlarged market." The only way to do this
is to apply new capital over a wide range of industries.
The complementarities of many industries will insure that
the developmental fabric, or the new burgeoning economy
will sustain growth once it is started. In this way, and
only in this way, will the "vicious circle of poverty,"
be broken.
According to the unbalanced approach to economic
development, growth can be induced by creating a disequili
brium situation. In this way development will be forced
through a demand or need for a particular good or service.
In this way decisions are forced on society. The propo
nent of this proposition, Hirschmann, believes that this
323
is the best way to induce development because there is one
critical factor of production in short supply in the under
developed countries, namely entrepreneurship.
The critical aspect of this theory is that there
must be criteria for placing the developmental funds into
the key projects. There are some economic sectors that
will prove to be more energetic in setting up a disequili
brium situation. Therefore, economic development moves
from the rather simple proposition of appropriating capital
to many sectors of the economy to a proposition where
capital should be added to a few key projects alone. In
short, there must be a strategy for inducing economic
growth. This is the basic idea presented by A. Hirschmann.
Another concept that he has introduced is that attention
must be focused on the path of economic development and
not on the end result.
Hirschmann is a severe critic of investment in
Social Overhead Capital. To develop his line of reasoning
he breaks economic activities into two categories, directly
productive activities and social overhead capital. However,
as discussed earlier in this paper, it is felt that this
is an error, because the same generalizations must be
applied to all activities within each category.
324
Unfortunately, this is a mistake; each activity within one
of the categories has a different effect on the economic
life of the country. Transport facilities, though a part
of Social Overhead Capital, are the best example. Trans
port services cannot be neglected if we are to have
economic development. However, if wa are to accept the
reasoning of the unbalanced approach, these vital services
would be neglected.
Historical evidence gives weight to the proposition
that the opening, or the improvement of an existing trans
port system creates economic activities. Of course, other
factors must be present before development will proceed.
Examples are labor, some capital, and entrepreneurial
ability. Transportation facilities are the permissive
element in the sequence of economic growth. It is possible
to make an even stronger statement, namely, transport
facilities are the necessary prerequisite for modern
economic development.
Transport nodes are the vital links in the transport
system. Inefficiency at one of these transshipment points
will mean very high costs. High costs inhibit the whole
developmental process. In regard to seaports, bad facili
ties may create expensive bottlenecks. An example is
325
harbor protection from waves and wind that are so bad the
ships are discouraged from calling at the port, unless the
rewards are very high. Insufficient transit sheds may mean
that valuable cargo must be left out in the open. Another
situation giving rise to a high cost port, is poor transport
facilities between the port and the interior.
The higher the cost of getting goods through the
transshipment point, the higher the cost of inducing
economic development will become. In order to avoid such
a somber prospect, it would be better to spend adequate
developmental funds on the transshipment facilities. Strong
breakwaters must be present along with aids to navigation.
This will insure a safe harbor. Spending money on such
facilities is logical, because they are durable in nature.
Also, funds must be allocated to transit sheds and harbor
belt railroads. In general, all transport facilities in
the port city must be modern and ample.
The contentment of the labor force in the port is
important. If these workers are ill-paid, they will become
involved in strikes, work stoppages, and the harrassment
of port industries. Therefore, wages must be high, educa
tion for the workers' children must be provided, health
standards must be maintained, and reasonably decent housing
326
must be available. Unfortunately, not all of these things
are available to the workers in many of the world's great
entrepots.
The conclusion we may draw from the above is that
economic development must proceed via excess capacity in
transportation. Within the transport network, the trans
shipment points are crucial to the functioning of the
whole system. Therefore, in order to have rapid economic
development, there must be excess capacity in economic
functions directly related to transshipment.
The theory presented here is that by providing
excess capacity in the function of transport, a sound basis
for creating economic growth will be established. In
regard to other developmental theories, balanced, unbal
anced, either may be accepted as long as the proposition is
first established that excess capacity must be present in
transport and in the transshipment function in particular.
Many Theories May Have Elements of Truth in Them
By deduction, or by the process of generalization,
certain broad theories may be formulated. From this,
various theories may be used in order to form an economic
model, a model through which policy may be formulated.
327
One problem to be avoided in accepting one particu
lar theory, is the rejection of all other theories. Most
theories have elements of truth in them. Therefore, the
problem becomes the choice of the theory on which you are
going to place the greatest reliance. Taking a dogmatic
approach to any one theory is dangerous.
There is another element that compounds the problem
for the economic development planner. Each underdeveloped
country is a special case. Each country is in a different
stage of development. Furthermore, each underdeveloped
country has a different political and economic history.
These two reasons make the world-wide development pattern
very diverse. What may constitute a real problem in one
country may not prove to be so in another. The diversity
of the development pattern has helped to give rise to
numerous theories on economic development.
Presently, there is controversy among these
theories. However, each of these theories have elements of
truth in them; all theories have added something to economic
developmental thought. Perhaps, in the future, the contro
versy among the theories will die. The result may be an
acceptance of certain elements from all development theories
within a super or a multitheory approach.
328
In regard to the ideas presented in this paper,
they have not been presented with a dogmatic attitude, but
rather in such a manner as to be considered as an addition
to economic development literature. It has been in regard
to an area that has been neglected in the past, namely the
transshipment point, and more specifically, the port. The
closest the writer has come to dogmatism is the statement
that economic development must proceed via excess capacity
built into transport services. This should not be con
strued to mean that economic development cannot take place
without excess capacity in transport. Economic development
can take place without this condition. However,it will be
hindered by a high-cost situation in transport. In addi
tion, the whole developmental process may be jeopardized
by bottlenecks arising in transportation. Once bottlenecks
arise, they become costly to relieve.
The safer approach in economic development planning
is to proceed either using a balanced approach concept or
an unbalanced approach concept. However, it is wise to
have excess capacity in transportation in either case,
with special attention being directed toward the transport
nodes or the transshipment points. Let us neither be too
329
dogmatic or too loose in our approach, but let us weigh
all theories and then relate what is relevant in them
to each case of underdevelopment.
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PERIODICALS
Andrews, Richard B. "Mechanics of The Urban Economic Base:
A Classification of Base Types," Land Economics, XXIX
(November, 1953), pp. 343-49.
Andrews, Richard B. "Mechanics of The Urban Economic Base:
Historical Development of the Base Concept," Land
Economics, XXIX (May, 1953), pp. 161-67.
Andrews, Richard B. "Mechanics of The Economic Base: The
Problem of Base Measurement," Land Economics, XXX
(February, 1954), pp. 52-60.
"Aquatic Research Institute Locates at Port of Stockton,"
Tideways. XII, No. 9, (November, 1963), pp. 4-7.
California's New Boom Area," Business Week, (April 2, 1960)
pp. 61-2.
Fagel, Robert W. "A Quantitative Approach to the Study of
Railroads in American Economic Growth: A Report of
Some Preliminary Findings," The Journal of Economic
History. XXII, No. 2, (June, 1962), pp. 163-197.
Hansen, W. Leez and Charles M. Tiebout. "An Intersectoral
Flows Analysis of the California Economy," Review of
Economics and Statistics, XLV (November, 1963),
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340
"Harbor Improvement is One Federal Job That Has Paid Off,"
Saturday Evening Post, 227:10-12 (April 30, 1955).
"New Energy Down From The North," California. LIII, No. ( > ,
(June, 1963), pp. 11-12 and p. 30.
North, D. C. "Location Theory and Regional Economic
Growth," Journal of Political Economy. LXIII (June,
1955), pp. 243-258.
"P C Wheat Sale," Pacific Shipper. XXXVIII, No. 46,
(January 6, 1964), p. 17.
Polanyi, Karl. "Ports of Trade in Early Societies," The
Journal of Economic History. XXIII, No. 1, (March,1963),
pp. 30-45.
"Port's 'One-Price Package Plan' Saves Handling Costs,"
Tideways, XII, No. 9, (November, 1963), p. 10-11.
"Record Cargo-Handling Activity at Port--10 Ships in Single
Day, 21 in 6-Day Span," Tideways. XII, No.9, pp. 8-9.
"Record Coke Shipment Caps Busy Bulk-Handling Period--
158,337 Tons in 10 Days," Tideways. XII, No.9, p. 3.
Sacramento Reporter. I, No. 1, 1962.
Sacramento Reporter. II, No. 1, July 1963.
"Sacramento Trade Workshops," Pacific Shipper, XXXIX,
No. 5, (March 23, 1964).
Small, C. "Port Authorities: Good or Bad," Nation* s
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Tiebout, Charles M. "Interregional Input-Output Models:
An Appraisal," Southern Economic Journal. XXIV,
(October, 1957), pp. 140-147.
341
NEWSPAPERS
Sacramento Bee, December 18, 1963, p. C-2.
Wall Street Journal, January 20, 1964, p. 16.
PAMPHLETS
California
California Economic Indicators, California State Chamber of
Commerce, January 7, 1964.
Economic Survey Series. Nos. 8, 9, 10, 14, and 22;
California State Chamber of Commerce.
Sacramento
Commemorative Program, Port of Sacramento Dedication
Ceremonies, Sacramento-Yolo Port District, 1963.
Look Through The Porthole, West Sacramento District Chamber
of Commerce.
Port of Sacramento, Sacramento-Yolo Port District.
Port of Sacramento, Tide and Current Tables 1964.
Sacramento Facts, Sacramento City-County Chamber of Commerce
1963.
Standard Industrial Survey Summary Report, Metropolitan
Sacramento, Sacramento City-County Chamber of Commerce,
1963.
Stone, W. G. Brief History of The Sacramento River Deep
Water Channel Project. 1963.
342
Stockton
Business Review, Greater Stockton Chamber of Commerce,1962.
Port of Stockton, Stockton Port District.
San Joaquin County. A Profile. Reprinted from California.
Magazine of The Pacific. December 1961.
Standard Industrial Survey Summary Report. Greater Stockton
Chamber of Commerce, 1963.
Statement Showing Tonnage Handled Thru Port of Stockton For
Years 1933-1962.
Stockton Statistical Review. Greater Stockton Chamber of
Commerce, 1963.
Miscellaneous
U. S. Congress, House Committee on Public Works, "The Civil
Functions Program of The Corps of Engineers, United
States Army, (Washington, D. C.: U. S. Government
Printing Office, 1952) a pamphlet.
INTERVIEWS
Sacramento
Connolly, Thomas F. Operations Manager, Port of Sacramento.
Griffith, William F. Operations Assistant, Port of
Sacramento.
Jordan, Art. Manager, West Sacramento Chamber of Commerce.
Miller, Bud. Public Relations Representative, Port of
Sacramento.
Rovzar, Craig. Industrial Division, Sacramento City-
County Chhmber of Commerce.
343
Sargeant, Charles. Bank of America, San Francisco Office.
Stockton
Ernest, George. Manager, Greater Stockton Chamber of
Commerce.
Lafferty, C. D. Industrial Division, Greater Stockton
Chamber of Commerce.
Melvin, Bruce. California State Division of Highways,
Stockton Office.
Pope, Gerald. Executive Assistant to the Director of the
Port of Stockton.
APPENDIXES
APPENDIX A
The Physical Characteristics of The Port of Sacramento
I. Ship Channel
A. Length: Sacramento to San Francisco,
79 nautical miles.
B. Bottom width in River reach: 300 feet.
C. Bottom width in Channel reach: 200 feet.
D. Minimum depth at low tide: 30 feet.
II. Harbor
A. Shape: triangular.
B. Dimensions: 2100 feet by 2400 feet by
3100 feet.
C. Area: 60 acres.
D. Minimum depth at low tide: 30 feet.
E. Tidal variation: average 5 feet.
III. Berths
A. Deep sea: 5 each.
B. Barge: 2 each.
C. Length: 600 feet.
D. Apron width: 60 feet.
IV. Cargo Facilities
A. Transit sheds.
345
346
IV A. Transit sheds (continued)
1. Number: 2 each.
2. Width: 180 feet.
3. Length: 480 feet.
4. Area (each): 86,400 feet.
5. Construction: Tiltup concrete.
6. Fire protection: sprinkler system.
B. Wharves and piers.
1. Construction: all concrete including
prestressed concrete piles.
2. Utilities available: power, telephone,
water, fire protection.
C. Bu^k cargo facilities
1. Grain elevator, capacity 1,250,000 bushels
2. Rice handling facility: owned by Rice
Growers Cooperative of California.
It is rated as being one of the world's
largest. 450 people are employed.
D. Cranes
1. Number: 2 gantry revolving.
2. Capacities:
a. 45 short tons at 40 feet.
b. 25 short tons at 70 feet.
c. 7 short tons at 135 feet.
E. Terminal area
IV. E. Terminal area (continued)
1. Paved storage area: 13.7 acres.
2. Available land: 650 acres.
V. Barge Canal
A. Length: 1.3 nautili miles.
B. Bottom width: 120 feet.
C. Minimum depth at low tide: 13 feet.
VI. Barge Lock
A. Usable length: 600 feet.
B. Width: 86 feet.
C. Minimum depth at low tide: 13 feet.
D. Gate type: Sector:
E. Gate height: 45.5 feet. These gates are
reputed to be the highest in the world.
F. Normal lockage time: 12 to 15 minutes.
348
APPENDIX B
The Physical Characteristics of The Port of Stockton
I. Ship Channel
A. Length: 75 nautical miles from the Golden Gate
Bridge to the Port of Stockton. Ships must
pass through San Francisco Bay, San Pablo Bay,
Carquinez Strait, Suisun Bay, New York Slough,
San Joaquin River, and the Stockton Ship
Channel.
B. Minimum depth at low tide: 32 feet from
Stockton to Martinez in Suisun Bay.
II. Harbor total acreage; 485.36 acres.
III. Berths
A. 7 general covered cargo berths.
1 open cargo berth with 20,000 square feet
of open space.
2 berths for the loading of bulk grain.
2 berths for the handling of bulk minerals in
outbound movements.
1 bulk wine delivery berth.
13 vessels may be accommodated at one time by
the port's facilities.
IV. Cargo Facilities
A. Warehouses or transit sheds. There are 30
warehousing units. The total area of these
units is 1,700,000 square feet. 5 of these
warehouses are devoted to the cotton compress.
This area is 274,000 square feet.
B. Cranes
2 gantry cranes; these are of 30-ton capacity
with a 60-foot reach. Scrap iron and bulk
minerals can be handled with magnets or
buckets.
349
APPENDIX C
Steamship Companies and Agents Whose Vessels Use The Port
of Stockton Either Regularly or Occasionally
To Atlantic Coast Ports
Isbrandtsen Steamship Company
Sea-Land Service, Inc.
From Atlantic Coast Ports
Sea-Land Service, Inc.
To Caribbean Ports
d'Amico Line
Hanseatic Vaasa
Kawakaki Risen Kaisha, Ltd.
Mitsui Steamship Company, Ltd.
States Marine-Isthmian Agency
To European Ports
Balfour, Guthrie and Company
Blue Star Line
East Asiatic Company
Fred Olsen Line
French Line
Furness Withy Line
Hamburg-American Line
Hanseatic Vaasa Line
Ho Hand-America Line
Interocean Line
Johnson Line
Mitsui Line Agencies
North German Lloyd Line
Pacific Central Steamship Agency
Royal Mail Line
States Marine-Isthmian Agency
From European Ports
Hamburg-American Line
North Cerman Lloyd Line
To Gulf Ports
States Marine-Isthmian Agency
350
To Hawaiian Ports
Matson Navigation Company
Oliver J. Olsen Company
To Mediterranean Ports
d'Amico Line
Italnavi Line
States Marine-Isthmian Agency
To Puerto Rican Ports
Isbrandtsen Steamship Company
Sea-Land Service, Inc.
To Central and South American Ports
Moore-McCormick Lines
Westfal-Larsen Company
To Transpacific Ports
American Mail Line
American President Lines
Bakke Steamship Corporation
Daido Line
East Asiatic Line
Java Pacific and Hoegh Line
Knutsen Line
Maersk Line
Maritime Company of the Philippines
Mitsubishi Line
Mitsui Line Agencies
Norton, Lilly Company
Nippon Risen Kaisha Line
Nippon Yusen Kaisha Line
Osaka Shosen Kaisha Ltd.
Overseas Shipping Company
Pacific Central Steamship Agents
Pacific Far East Line
Pacific Orient Express Line
States Line
States Marine-Isthmian Agency
Transpacific Transportation Company
Waterman Corporation
Yamashita Line

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Asset Metadata

Creator Hammelton, Raynal Leigh (author)

Core Title New Port Cities In Western America And Their Effect On Economic Development

Degree Doctor of Philosophy

Degree Program Economics

Publisher University of Southern California (original), University of Southern California. Libraries (digital)

Tag economics, history,OAI-PMH Harvest

Format dissertations (aat)

Language English

Contributor Digitized by ProQuest (provenance)

Advisor Grey, Arthur Leslie, Jr (committee chair), Graves, Richard W. (committee member), Morgner, Aurelius (committee member)

Permanent Link (DOI) https://doi.org/10.25549/usctheses-c18-367128

Unique identifier UC11358979

Identifier 6506907.pdf (filename),usctheses-c18-367128 (legacy record id)

Legacy Identifier 6506907.pdf

Dmrecord 367128

Document Type Dissertation

Format dissertations (aat)

Rights Hammelton, Raynal Leigh

Type texts

Source University of Southern California (contributing entity), University of Southern California Dissertations and Theses (collection)

Access Conditions The author retains rights to his/her dissertation, thesis or other graduate work according to U.S. copyright law. Electronic access is being provided by the USC Libraries in agreement with the au...

Repository Name University of Southern California Digital Library

Repository Location USC Digital Library, University of Southern California, University Park Campus, Los Angeles, California 90089, USA