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'An awkward fence to cross': railway capitalization in Britain in the inter-war years


  • Gerald Crompton
  • Robert Jupe


This paper examines the related problems of the capitalization and financial performance of the railway companies in the inter-war period. It examines the critics' view that the railways were over-capitalized, and places the debate in context by analysing the dividend and accounting policies of the companies and the consequences for investment. It also examines the conflicting views of railway management and shareholders over capital expenditure. The paper concludes that the railways were both financially over-capitalized and physically under-capitalized, and so faced very serious financial problems that were incapable of resolution within the existing ownership structure.

Suggested Citation

  • Gerald Crompton & Robert Jupe, 2002. "'An awkward fence to cross': railway capitalization in Britain in the inter-war years," Accounting History Review, Taylor & Francis Journals, vol. 12(3), pages 439-459.
  • Handle: RePEc:taf:acbsfi:v:12:y:2002:i:3:p:439-459
    DOI: 10.1080/09585200210164593

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    References listed on IDEAS

    1. Jensen, Michael C, 1986. "Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers," American Economic Review, American Economic Association, vol. 76(2), pages 323-329, May.
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