Railroads encouraged the growth of settlements in the west because they

Railroads encouraged settlement in the west because they opened up economic opportunities in the west. Through the railroad, products from west coast could be transported back to the East and vice-versa and thereby opening up the markets of the west and also Asia to the East.

To exploit the new business opportunities, people began to move and settle in the west.  Within 10 years of its completion, the railroad shipped $50 million worth of freight coast to coast every year. It ensured a production boom and was America's first technology corridor