Economic factors for nationalisation

Industrial revolution and the economic ambitions of Prussia increased nationalistic feeling in the German Bund.

Industrialisation and demographic change

In the early 19th century, industrialisation was gaining pace in the German states. The exploitation of Germany’s vast raw materials brought wealth for an emerging middle class. One of the states which benefitted most was Prussia, which was granted control of industrial land on the River Rhine in 1815.

The industrial revolution brought demographic change. Urbanisation increased as people moved to the towns to work in the new industries. The population rose and people living in such close proximity meant there was potential for uprisings.

The development of the railways greatly improved communication between the states and allowed for the growth of increased inter-state trade.

However, industrial growth for the German states was severely hampered by trade barriers and differences in laws and currencies. The new middle class began to push for change to improve their economic standing.

Trade barriers and the Zollverein

Most existing trade was conducted within and between the 39 states. But it was hampered by tariff barriers.

With growing production and improved transportation, businesses looked to maximise profits by increasing the markets available for their goods. A single Germany without so many taxes and tariffs would increase prosperity.

Much push for economic change came from Prussia. The profits of Prussian businesses were limited by taxes which had to be paid for moving goods between the two Prussian territories.

In 1818, Prussia scrapped trade tariffs within its own territories and lowered import rates. Throughout the 1820s and early 1830s, other German states joined this voluntary customs union. This became known as the Zollverein.

By 1836, 25 of the 39 German states had joined this economic alliance. This indicated that a more permanent, political union could be beneficial. The historian William Carr referred to the Zollversin as the mighty lever of German unification.