IDEAS home Printed from
   My bibliography  Save this article

Municipalizing American Waterworks, 1897--1915


  • Werner Troesken


We consider three explanations for public ownership: public interest, regulation, and a transaction cost interpretation. We employ a large dataset containing information on the municipal acquisition of U.S. private water companies between 1897 and 1915. Those data allow us to isolate the effects of high water rates, water quality, financial difficulties, extensiveness of distribution system, and the like in determining the probability of subsequent municipal takeover of companies that were private in 1897. After controlling for such factors, we find evidence consistent with a transaction cost interpretation of municipal acquisition. We find relatively little support for regulation-based or public interest interpretations. Our evidence indicates that municipalities were unable to credibly precommit to not expropriating value from private water companies once investments were made, resulting in a rational reduction in investment in water provision by private companies. Local governments, in turn, used this rational underinvestment as a pretext for municipalizing private water companies. Copyright 2003, Oxford University Press.

Suggested Citation

  • Werner Troesken, 2003. "Municipalizing American Waterworks, 1897--1915," Journal of Law, Economics, and Organization, Oxford University Press, vol. 19(2), pages 373-400, October.
  • Handle: RePEc:oup:jleorg:v:19:y:2003:i:2:p:373-400

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Spiller, Pablo T., 2013. "Transaction cost regulation," Journal of Economic Behavior & Organization, Elsevier, vol. 89(C), pages 232-242.
    2. Kitchens, Carl T. & Jaworski, Taylor, 2017. "Ownership and the price of residential electricity: Evidence from the United States, 1935–1940," Explorations in Economic History, Elsevier, vol. 64(C), pages 53-61.
    3. Beecher, Janice A. & Kalmbach, Jason A., 2013. "Structure, regulation, and pricing of water in the United States: A study of the Great Lakes region," Utilities Policy, Elsevier, vol. 24(C), pages 32-47.
    4. Felix Höffler & Achim Wambach, 2013. "Investment coordination in network industries: the case of electricity grid and electricity generation," Journal of Regulatory Economics, Springer, vol. 44(3), pages 287-307, December.
    5. Howard Bodenhorn, 2017. "Finance and Growth: Household Savings, Public Investment, and Public Health in Late Nineteenth-Century New Jersey," NBER Working Papers 23430, National Bureau of Economic Research, Inc.
    6. Brian Beach & Werner Troesken & Nicola Tynan, 2016. "Who Should Own and Control Urban Water Systems? Historical Evidence from England and Wales," NBER Working Papers 22553, National Bureau of Economic Research, Inc.
    7. Edward L. Glaeser, 2012. "Urban Public Finance," NBER Working Papers 18244, National Bureau of Economic Research, Inc.
    8. Matthew Gandy, 2006. "Water, Sanitation and the Modern City: Colonial and Post-colonial Experiences in Lagos and Mumbai," Human Development Occasional Papers (1992-2007) HDOCPA-2006-06, Human Development Report Office (HDRO), United Nations Development Programme (UNDP).
    9. Lauren Hoehn Velasco, 2016. "Explaining Declines in US Rural Mortality, 1910-1933: The Role of County Health Departments," Boston College Working Papers in Economics 919, Boston College Department of Economics.
    10. repec:eee:juipol:v:48:y:2017:i:c:p:210-218 is not listed on IDEAS

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:jleorg:v:19:y:2003:i:2:p:373-400. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.