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Big Social Savings in a Small Laggard Economy: Railroad-Led Growth in Brazil

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  • SUMMERHILL, WILLIAM R.

Abstract

Railroad development had a profound impact in nineteenth- and early-twentieth-century Brazil. Direct benefits were small for passengers, but large for freight services, and contributed heavily to the transition from stagnation to growth. Domestic-use activities received a differentially large stimulus. Estimates of the social rate of return reveal that Brazil did not overinvest in railroads. A different allocation of subsidies to railroad capital could have generated additional gains. Backward linkages did little for industry, but the “leakage†attributable to imported inputs was modest. Institutional externalities were mixed. By 1913 railroads had paved the way for dramatically improved economic growth.

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  • Summerhill, William R., 2005. "Big Social Savings in a Small Laggard Economy: Railroad-Led Growth in Brazil," The Journal of Economic History, Cambridge University Press, vol. 65(1), pages 72-102, March.
    • Handle: RePEc:cup:jechis:v:65:y:2005:i:01:p:72-102_05
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    Cited by:

    1. Leunig, Tim, 2010. "Social savings," LSE Research Online Documents on Economics 30135, London School of Economics and Political Science, LSE Library.
    2. Dan Bogart & Latika Chaudhary & Alfonso Herranz-Loncan, 2015. "The Growth Contribution of Colonial Indian Railways in Comparative Perspective," CEH Discussion Papers 033, Centre for Economic History, Research School of Economics, Australian National University.
    3. SERGI BASCO & John P. Tang, 2017. "The Samurai Bond: Credit Supply And Economic Growth In Pre-War Japan," CEH Discussion Papers 05, Centre for Economic History, Research School of Economics, Australian National University.
    4. Tim Leunig & Joachim Voth, 2011. "Spinning Welfare: the Gains from Process Innovation in Cotton and Car Production," CEP Discussion Papers dp1050, Centre for Economic Performance, LSE.
    5. Latika Chaudhary & Fenske, James, 2020. "Did railways affect literacy? Evidence from India," CAGE Online Working Paper Series 529, Competitive Advantage in the Global Economy (CAGE).
    6. Gregg Huff, 2007. "Globalization, Natural Resources and Foreign Investment: A View from the Resource-Rich Tropics," Working Papers 2007_16, Business School - Economics, University of Glasgow.
    7. Tang, John P., 2017. "The Engine And The Reaper: Industrialization And Mortality In Late Nineteenth Century Japan," Journal of Health Economics, Elsevier, vol. 56(C), pages 145-162.
    8. Palma, Nuno & Papadia, Andrea & Pereira, Thales & Weller, Leonardo, 2020. "Slavery and development in nineteenth century Brazil," CAGE Online Working Paper Series 523, Competitive Advantage in the Global Economy (CAGE).
    9. Andrea Forero & Francisco Gallego & Felipe González & Matías Tapia, 2020. "Railroads, specialization, and population growth in small open economies: Evidence from the First Globalization," Documentos de Trabajo 548, Instituto de Economia. Pontificia Universidad Católica de Chile..
    10. Summerhill, William, 2010. "Colonial Institutions, Slavery, Inequality, and Development: Evidence from São Paulo, Brazil," MPRA Paper 22162, University Library of Munich, Germany.
    11. Leunig, Timothy, 2006. "Time is Money: A Re-Assessment of the Passenger Social Savings from Victorian British Railways," The Journal of Economic History, Cambridge University Press, vol. 66(3), pages 635-673, September.
    12. Tim Leunig, 2010. "Social Savings," Journal of Economic Surveys, Wiley Blackwell, vol. 24(5), pages 775-800, December.
    13. Tim Leunig, 2011. "Cart or Horse: Transport and Economic Growth," International Transport Forum Discussion Papers 2011/4, OECD Publishing.
    14. 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.
    15. Leunig, Tim & Voth, Joachim, 2011. "Spinning welfare: the gains from process innovation in cotton and car production," Economic History Working Papers 121731, London School of Economics and Political Science, Department of Economic History.
    16. Chaudhary, Latika & Fenske, James, 2020. "Did railways affect literacy? Evidence from India," The Warwick Economics Research Paper Series (TWERPS) 1320, University of Warwick, Department of Economics.
    17. Berger, Thor, 2019. "Railroads and Rural Industrialization: evidence from a Historical Policy Experiment," Explorations in Economic History, Elsevier, vol. 74(C).
    18. 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.
    19. Andrés Forero & Francisco A. Gallego & Felipe González & Matías Tapia, 2021. "Railroads, specialization, and population growth: evidence from the first globalization," Journal of Population Economics, Springer;European Society for Population Economics, vol. 34(3), pages 1027-1072, July.
    20. Tang, John P., 2015. "The Engine And The Reaper: Industrialization And Mortality In Early Modern Japan," RCESR Discussion Paper Series DP15-10, Research Center for Economic and Social Risks, Institute of Economic Research, Hitotsubashi University.
    21. Lakshmanan, T.R., 2011. "The broader economic consequences of transport infrastructure investments," Journal of Transport Geography, Elsevier, vol. 19(1), pages 1-12.
    22. Barakatou Atte-Oudeyi & Bruno Kestemont & Jean Luc De Meulemeester, 2016. "Road Transport, Economic Growth and Carbon Dioxide Emissions in the BRIICS: Conditions For a Low Carbon Economic Development," Working Papers CEB 16-023, ULB -- Universite Libre de Bruxelles.

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