Robert Fulton and Robert Livingston introduced the steam boat on the Hudson. They then collected a monopoly from the New York-New Jersey ferry service. Steamboat traffic increased majorly after the gibbons vs. Ogden case. The amount of steam boats operating in the western rivers jumped from 17 in 1817 to 727 in 1855 and had become more practical.
While steamboats had value, canals replaced roads and turnpikes. Canals helped reduce the shipping cost of items, even though the price of a canal was outrageous. They were used for cities that had a waterfront inland. Canals helped connect the Mississippi Ohio river to Great Lakes and Great Lakes with eastern markets. The Erie Canal, enable produce from ohio to reach New York City by a continuous stretch of water front. This later resulted in New York becoming the nations largest city.
Railroads were a faster, easier, and able to reach more places than canals. In 1825 the first commercial railroad began it's operation in England. Cities like Boston and Baltimore, that lacked major inland waterway connections turned to railroads to enlarge their share if the western market. Even though railroads were cheaper to produce than canals they obtained more maintenance than canals did, which then made it more costly than the canals.
Steamboats, canals, and railroads effected the economy both positively and negatively. They changed the way of life to this day and created an easier way of transportation nation wide.