Final answer:
In the mid-19th century, the railroad companies were competing with canal systems, but railroads grew to dominate transportation and stimulated the economy.
Step-by-step explanation:
Throughout the mid-19th century, the railroad companies were primarily competing against canal systems as forms of transportation for goods and passengers. As the century progressed, the railroads outpaced canals due to their speed and direct routes, eventually becoming the dominant mode of transport. The railroad industry experienced explosive growth, particularly with the development of the transcontinental railroad, which united the east and west coasts of the United States. This growth was catalyzed by advances in railroad technology, such as car couplers, air brakes, and Pullman passenger cars, and was supported by both government grants and private investment.
Companies like the Central Pacific and Union Pacific Railroads were instrumental in the expansion westward, and this infrastructure project was inclusive of a very diverse workforce including immigrants and Civil War veterans. Massive industry tycoons like Andrew Carnegie, John D. Rockefeller, and J.P. Morgan arose during this time, contributing to the railroad's success and the economic growth of the United States, though this often occurred at the expense of smaller businesses and farmers who labeled these moguls as 'robber barons' due to their exploitative practices.
The railroad network not only transported goods but also facilitated a growing nation in governance and communication, working hand in hand with advancements like the telegraph. The first commercial railroad in the United States was established by the Baltimore and Ohio Company and continued to grow to over 200,000 miles of track by the end of the 19th century.