Regulation, Ownership, and Costs: A Historical Perspective from Indian Railways
This paper studies the relationship between operational costs and state ownership in Indian railways between 1874 and 1912. We find the move to state ownership significantly decreased working expenses. The cost declines are not driven by anticipation effects, changes in reporting standards, or long run trends. Rather, the evidence suggests the colonial Government of India reduced operational costs by cutting labor costs. Our surprising results can be explained by the undemocratic colonial nature of the Government of India, a fiscal system heavily reliant on railways for revenues, and a regulatory environment under private ownership that weakened incentives to lower costs. (JEL L32, L51, L92, N45, N75, O18, R41)
Volume (Year): 4 (2012)
Issue (Month): 1 (February)
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Antonio Estache & L. Wren-Lewis, 2009.
"Towards a Theory of Regulation for Developing Countries: Following Jean-Jacques Laffont's Lead,"
ULB Institutional Repository
2013/43903, ULB -- Universite Libre de Bruxelles.
- Antonio Estache & Liam Wren-Lewis, 2009. "Toward a Theory of Regulation for Developing Countries: Following Jean-Jacques Laffont's Lead," Journal of Economic Literature, American Economic Association, vol. 47(3), pages 729-70, September.
- Andrabi, Tahir & Kuehlwein, Michael, 2010. "Railways and Price Convergence in British India," The Journal of Economic History, Cambridge University Press, vol. 70(02), pages 351-377, June.
- Estrin, Saul & Hanousek, Jan & Kocenda, Evzen & Svejnar, Jan, 2009.
"Effects of privatization and ownership in transition economies,"
Policy Research Working Paper Series
4811, The World Bank.
- Saul Estrin & Jan Hanousek & Evzen Kocenda & Jan Svejnar, 2009. "The Effects of Privatization and Ownership in Transition Economies," Journal of Economic Literature, American Economic Association, vol. 47(3), pages 699-728, September.
- Chaudhary, Latika, 2009. "Determinants of Primary Schooling in British India," The Journal of Economic History, Cambridge University Press, vol. 69(01), pages 269-302, March.
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