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Railroad expansion and entrepreneurship: evidence from Meiji Japan

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  • John Tang

Abstract

Railroads in Meiji Japan are credited with facilitating factor mobility as well as access to human and financial capital, but the impact on firms is unclear. Using a newly developed firm-level dataset and a difference-in-differences model that exploits the temporal and spatial variation of railroad expansion, I assess the relationship between railways and firm activity across Japan. Results indicate that railroad expansion corresponded with increased firm activity, particularly in manufacturing, although this effect is mitigated in less populous regions. These findings are consistent with industrial agglomeration in areas with larger markets and earlier development among both new and existing establishments.

Suggested Citation

  • John Tang, 2013. "Railroad expansion and entrepreneurship: evidence from Meiji Japan," CEH Discussion Papers 011, Centre for Economic History, Research School of Economics, Australian National University.
    • Handle: RePEc:auu:hpaper:011
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    File URL: https://cbe.anu.edu.au/researchpapers/CEH/WP201301.pdf
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    Citations

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    Cited by:

    1. Junichi Yamasaki, 2017. "Railroads, Technology Adoption, and Modern Economic Development: Evidence from Japan," ISER Discussion Paper 1000, Institute of Social and Economic Research, Osaka University.
    2. Braun, Sebastian Till & Franke, Richard, 2022. "Railways, Growth, and Industrialization in a Developing German Economy, 1829–1910," The Journal of Economic History, Cambridge University Press, vol. 82(4), pages 1183-1221, December.
    3. Meissner, Christopher M. & Tang, John P., 2018. "Upstart Industrialization and Exports: Evidence from Japan, 1880–1910," The Journal of Economic History, Cambridge University Press, vol. 78(4), pages 1068-1102, December.
    4. Bo, Shiyu & Liu, Cong & Zhou, Yan, 2023. "Military investment and the rise of industrial clusters: Evidence from China’s self-strengthening movement," Journal of Development Economics, Elsevier, vol. 161(C).
    5. Maravall Buckwalter, Laura, 2018. "Build It, and They Will Come? Secondary Railways and Population Density in French Algeria," IFCS - Working Papers in Economic History.WH 26738, Universidad Carlos III de Madrid. Instituto Figuerola.
    6. Johnson, Noel D. & Koyama, Mark, 2017. "States and economic growth: Capacity and constraints," Explorations in Economic History, Elsevier, vol. 64(C), pages 1-20.
    7. Bogart, Dan & You, Xuesheng & Alvarez-Palau, Eduard J. & Satchell, Max & Shaw-Taylor, Leigh, 2022. "Railways, divergence, and structural change in 19th century England and Wales," Journal of Urban Economics, Elsevier, vol. 128(C).
    8. Berger, Thor, 2019. "Railroads and Rural Industrialization: evidence from a Historical Policy Experiment," Explorations in Economic History, Elsevier, vol. 74(C).
    9. Chan, Jeff, 2022. "Farming output, concentration, and market access: Evidence from the 19th-century American railroad expansion," Journal of Development Economics, Elsevier, vol. 157(C).
    10. Alfonso Herranz-Loncán & Johan Fourie, 2018. "“For the public benefit”? Railways in the British Cape Colony," European Review of Economic History, European Historical Economics Society, vol. 22(1), pages 73-100.
    11. Rui Manuel Pereira, Alfredo Marvao Pereira and William J. Hausman, 2017. "Railroad Infrastructure Investments and Economic Development in the Antebellum United States," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 42(3), pages 1-16, September.
    12. John P. Tang, 2016. "A tale of two SICs: Japanese and American industrialisation in historical perspective," Australian Economic History Review, Economic History Society of Australia and New Zealand, vol. 56(2), pages 174-197, July.
    13. Zhigang Li & Hangtian Xu, 2018. "High‐speed railroads and economic geography: Evidence from Japan," Journal of Regional Science, Wiley Blackwell, vol. 58(4), pages 705-727, September.
    14. Laura Maravall Buckwalter, 2018. "Build it and they will come? Secondary railways and population density in French Algeria," Working Papers 18008, Economic History Society.
    15. Atack, Jeremy & Margo, Robert A. & Rhode, Paul W., 2022. "Industrialization and urbanization in nineteenth century America," Regional Science and Urban Economics, Elsevier, vol. 94(C).
    16. Pushkar Maitra & William Yu, 2021. "The Long Shadow of Infrastructure Development: Long Run Effects of Railway Construction in Colonial India," Monash Economics Working Papers 2021-01, Monash University, Department of Economics.
    17. Gerring, John & Gjerløw, Haakon & Knutsen, Carl Henrik, 2022. "Regimes and industrialization," World Development, Elsevier, vol. 152(C).
    18. Konstantin Buechel, Stephan Kyburz, 2016. "Fast Track to Growth? The Impact of Railway Access on Regional Economic Development in 19th Century Switzerland," Diskussionsschriften credresearchpaper12, Universitaet Bern, Departement Volkswirtschaft - CRED.
    19. Koyama, Mark & Moriguchi, Chiaki & Sng, Tuan-Hwee, 2018. "Geopolitics and Asia’s little divergence: State building in China and Japan after 1850," Journal of Economic Behavior & Organization, Elsevier, vol. 155(C), pages 178-204.
    20. Tang, John P. & Basco, Sergi, 2023. "Banks, credit supply, and the life cycle of firms: Evidence from late nineteenth century Japan," Journal of Banking & Finance, Elsevier, vol. 154(C).
    21. John P. Tang, 2016. "A tale of two SICs: Japanese and American industrialisation in historical perspective," Australian Economic History Review, Economic History Society of Australia and New Zealand, vol. 56(2), pages 174-197, July.
    22. Yu Hao & Kevin Zhengcheng Liu, 2020. "Taxation, fiscal capacity, and credible commitment in eighteenth‐century China: the effects of the formalization and centralization of informal surtaxes," Economic History Review, Economic History Society, vol. 73(4), pages 914-939, November.
    23. Xu, Hangtian, 2016. "Domestic railroad infrastructure and exports: Evidence from the Silk Route," China Economic Review, Elsevier, vol. 41(C), pages 129-147.
    24. Bogart, Dan, 2022. "Infrastructure and institutions: Lessons from history," Regional Science and Urban Economics, Elsevier, vol. 94(C).

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    More about this item

    Keywords

    agglomeration; entrepreneurship; firm genealogy; late development;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • N75 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Asia including Middle East
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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