Sources: Airfare data expanded from Bowen, J. (2004) “World-Shapers: The Geographical Implications of Several Influential Jet Aircraft”, (full economy airfare). Computer storage data updated from John C. McCallum. Sea freight rates data from The Eddington Transport Study (2006) and from UNCTAD (after 1980). Telephone call data from various sources. For lithium-Ion battery cells: Rupert Way (2026) based on Ziegler and Trancik (2021), BloombergNEF, and Avicenne Energy.
Transport and communications costs have declined considerably during the 20th century, notably due to technological improvements, the diffusion of transportation infrastructure, and the application of economies of scale. By 1960, maritime transport costs by tonnage were a third of their 1920 level. With the advent of containerization in the 1960s, maritime transportation costs further declined. Air transportation costs followed a similar trend, but over a much shorter time frame. Air transportation boomed after WWII, driven by technological improvements (such as the jet engine) and improved aircraft design for fuel efficiency and comfort. The 1970s were particularly significant for the introduction of long-distance, fuel-efficient planes such as the Boeing 747. However, by 2000, sea freight rates and airfares had leveled off, and costs have not changed significantly since then. This underlines the infrastructure and capital intensity of these modes having a cost structure that cannot be changed significantly, even with economies of scale and technical improvements. The COVID-19 pandemic was associated with a temporary rise in airfares due to significantly lower demand and additional sanitary measures.
Telecommunications are a sector where costs have decreased significantly as well. In 2000, an international phone call cost about 1% of what it did in 1940. For instance, while a three-minute phone call between New York and London cost $293 in 1931 (1993 dollars), the same call cost $1 in 2001, about $0.25 in 2005, $0.05 in 2015, and less than $0.01 in 2025. With fiber-optic cables, telecommunications are accessible worldwide, particularly through the Internet, making long-distance communication nearly free and ubiquitous. The mass diffusion of cell phones since the 1990s and of smartphones since the 2010s has further reduced costs. Another significant wave of innovation involves information technologies, as indicated by the excessively rapid decrease in computer storage costs since their initial introduction (mainframes) in the 1960s. By the 1990s, low storage costs enabled the widespread adoption of personal computers, with each new generation faster and cheaper than the previous. By the 2010s, low storage costs made smartphones and portable computing devices possible.
The rapid diffusion of electric vehicles in the early 2010s is associated with declines in the most costly element of an electric vehicle, its battery cell. While a kilowatt-hour on a lithium-ion battery was more than $9,000 in the early 1990s, this figure dropped to less than $100 by 2024. Lithium-ion batteries are also an important support for information technology devices such as smartphones, so a drop in their cost makes them more affordable and ubiquitous.
Globalization and its related high mobility levels could not have occurred without low transport and telecommunication costs.