The German-speaking lands after 1815 were a patchwork of dozens of independent states, each levying its own customs duties at its own borders, so a wagon of goods crossing from one end of Germany to the other might clear tariffs a dozen times. Prussia wanted the economic and eventually political leadership of a unified Germany, but a military campaign to force smaller states into line risked coalitions against it, foreign intervention, and years of instability it could not afford after the Napoleonic Wars.

Simply lowering Prussia's own tariffs wouldn't unify anyone else's, and asking neighboring states to surrender their independent customs revenue for the vague promise of future prosperity gave small states every reason to refuse and stay outside, collecting their own duties as before.

Starting with a tariff law in 1818, Prussia abolished its internal customs and built a single external tariff wall, then invited neighboring states in one at a time, sharing the pooled customs revenue out by population rather than by origin and paying for roads into new member states — so each new member made staying outside more expensive for the states still holding out.

Prussia built a tariff union that paid states to join, sharing customs revenue by population so each new member made staying out costlier for the rest.

Population-based revenue sharing gave small states a tangible gain from joining, not just a promise.

Each new member widened the tariff wall, shrinking holdouts' markets and raising the cost of staying out.

The union's growth did Prussia's recruiting, as holdouts faced worsening economics with every defection.

To recruit coalition members, make joining immediately profitable and staying out increasingly costly, so the coalition recruits itself.

By 1834 most German states outside Austria had joined the Zollverein, unifying Germany's market decades before its politics. The tariff union proved that Germany could be economically integrated without a shot fired, and the shared market and administrative habits it built became the foundation Bismarck used to unify Germany politically under Prussian leadership in 1871.

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The sources

  1. German Customs Union EBSCO Research Starters · ebsco.com