On some socio-economic consequences of railway construction in Russia

The paper analyzes the socio-economic consequences of the first network of Russian railways constructed between 1866 and 1875. The purpose of this project, according to the plan of the Minister of Finance M. Kh. Reitern, was to increase exports and improve trade and the balance of payments. In accordance with this plan, “export” railways were prioritized, linking inland agricultural regions with the seaports Grain exports increased sixfold between 1862 and 1878, comprising 3/5 of total exports by value. Correcting official grain collection data reveals a 17% decrease in per capita net grain balance in European Russia from 1862 to 1881 due to massive exports. The decrease in consumption is also evident from the declining average height of recruits, which dropped by 0.4 cm in 1882-1884 compared to 1875-1884. The most significant decline of 0.7 cm or more occurred in regions from where grain was exported. While the consumption of the peasants was decreasing, the standard of living of the “sufficient classes” was rising. Exporting grain to industrial countries of Europe, where grain prices were higher than in Russia, sharply increased income for landowners and doubled the value of their land. Correspondingly, the size of deposits in banks and the imports of high-quality consumer goods increased. The number of “travelers” going abroad and the amount of currency they took with them rose sharply.