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Did Railroads Induce Or Follow Economic Growth? Urbanization And Population Growth In The American Midwest, 1850-60

Author

Listed:
  • Jeremy Atack

    () (Department of Economics, Vanderbilt University)

  • Fred Bateman

    () (University of Georgia, Department of Economics)

  • Michael Haines

    () (Colgate University, Department of Economics)

  • Robert A. Margo

    () (Boston University, Department of Economics)

Abstract

For generations of scholars and observers, the "transportation revolution," especially the railroad, has loomed large as a dominant factor in the settlement and development of the United States in the nineteenth century. There has, however, been considerable debate as to whether transportation improvements led economic development or simply followed. Using a newly developed GIS transportation database we examine this issue in the context of the American Midwest, focusing on two indicators of broader economic change, population density and the fraction of population living in urban areas. Our difference in differences estimates (supported by IV robustness checks) strongly suggest that the coming of the railroad had little or no impact upon population densities just as Albert Fishlow concluded some 40 years ago. BUT, our results also imply that the railroad was the "cause" of midwestern urbanization, accounting for more than half of the increase in the fraction of population living in urban areas during the 1850s.

Suggested Citation

  • Jeremy Atack & Fred Bateman & Michael Haines & Robert A. Margo, 2009. "Did Railroads Induce Or Follow Economic Growth? Urbanization And Population Growth In The American Midwest, 1850-60," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-178, Boston University - Department of Economics.
  • Handle: RePEc:bos:iedwpr:dp-178
    as

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    File URL: http://www.bu.edu/econ/ied/dp/papers/dp%20178IED_Midwest_RR.pdf
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    References listed on IDEAS

    as
    1. The Conference on Research in Income and Wealth, 1960. "Trends in the American Economy in the Nineteenth Century," NBER Books, National Bureau of Economic Research, Inc, number unkn60-1, January.
    2. Craig, Lee A & Palmquist, Raymond B & Weiss, Thomas, 1998. "Transportation Improvements and Land Values in the Antebellum United States: A Hedonic Approach," The Journal of Real Estate Finance and Economics, Springer, vol. 16(2), pages 173-189, March.
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    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Did railroads induce or follow economic growth?
      by Economic Logician in Economic Logic on 2009-06-25 23:52:00

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    Cited by:

    1. John Tang, 2013. "Railroad expansion and entrepreneurship: Evidence from Meiji Japan," AJRC Working Papers 1302, Australia-Japan Research Centre, Crawford School of Public Policy, The Australian National University.
    2. Scott L. Fulford, 2015. "How Important Are Banks for Development? National Banks in the United States, 1870-1900," The Review of Economics and Statistics, MIT Press, vol. 97(5), pages 921-938, December.
    3. Jon Bakija & Adam Cole & Bradley Heim, 2008. "Jobs and Income Growth of Top Earners and the Causes of Changing Income Inequality: Evidence from U.S. Tax Return Data," Department of Economics Working Papers 2010-22, Department of Economics, Williams College, revised Jan 2012.
    4. Timothy J. Riddiough & Howard E. Thompson, 2012. "Deja vu All Over Again: Agency, Uncertainty, Leverage and the Panic of 1857," Working Papers 102012, Hong Kong Institute for Monetary Research.
    5. Dave Donaldson & Richard Hornbeck, 2016. "Railroads and American Economic Growth: A "Market Access" Approach," The Quarterly Journal of Economics, Oxford University Press, vol. 131(2), pages 799-858.
    6. Erik Hornung, 2012. "Railroads and Micro-regional Growth in Prussia," ifo Working Paper Series 127, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    7. He, Xiaobo, 2013. "Wages and Access to International Markets: Evidence from Urban China," MPRA Paper 44537, University Library of Munich, Germany.
    8. Adam Storeygard, 2016. "Farther on down the Road: Transport Costs, Trade and Urban Growth in Sub-Saharan Africa," Review of Economic Studies, Oxford University Press, vol. 83(3), pages 1263-1295.
    9. William J. Collins & Robert A. Margo, 2014. "Introduction to "Enterprising America: Businesses, Banks, and Credit Markets in Historical Perspective"," NBER Chapters,in: Enterprising America: Businesses, Banks, and Credit Markets in Historical Perspective, pages 1-22 National Bureau of Economic Research, Inc.
    10. Barham, Tania & Lipscomb, Molly & Mobarak, Ahmed Mushfiq, 2011. "Development Effects of Electrification: Evidence from the Geologic Placement of Hydropower Plants in Brazil," CEPR Discussion Papers 8427, C.E.P.R. Discussion Papers.
    11. Jaremski, Matthew, 2014. "National Banking's Role in U.S. Industrialization, 1850–1900," The Journal of Economic History, Cambridge University Press, vol. 74(01), pages 109-140, March.
    12. Atack, Jeremy & Margo, Robert, 2011. "The Impact of Access to Rail Transportation on Agricultural Improvement: The American Midwest as a Test Case, 1850-1860," The Journal of Transport and Land Use, Center for Transportation Studies, University of Minnesota, vol. 4(2), pages 5-18.
    13. Jeremy Atack & Matthew S. Jaremski & Peter L. Rousseau, 2014. "Did Railroads Make Antebellum U.S. Banks More Sound?," NBER Chapters,in: Enterprising America: Businesses, Banks, and Credit Markets in Historical Perspective, pages 149-178 National Bureau of Economic Research, Inc.
    14. Monica Beuran & Marie Gachassin & Gaël Raballand, 2015. "Are There Myths on Road Impact and Transport in Sub-Saharan Africa?," Development Policy Review, Overseas Development Institute, vol. 33(5), pages 673-700, September.
    15. Berger, Thor & Enflo, Kerstin, 2017. "Locomotives of local growth: The short- and long-term impact of railroads in Sweden," Journal of Urban Economics, Elsevier, vol. 98(C), pages 124-138.
    16. Banerjee, Abhijit & Duflo, Esther & Qian, Nancy, 2012. "On the Road: Access to Transportation Infrastructure and Economic Growth in China," CEPR Discussion Papers 8874, C.E.P.R. Discussion Papers.
    17. Raimundo Soto, 2010. "End of the line: Railroads in Chile," Documentos de Trabajo 391, Instituto de Economia. Pontificia Universidad Católica de Chile..
    18. Elodie Djemai, 2017. "Roads and the Spread of AIDS in Africa," Working Papers DT/2017/16, DIAL (Développement, Institutions et Mondialisation).
    19. Jeremy Atack & Robert A. Margo, 2009. "Agricultural Improvements and Access to Rail Transportation: The American Midwest as a Test Case, 1850-1860," NBER Working Papers 15520, National Bureau of Economic Research, Inc.
    20. Chai, Jian & Yang, Ying & Wang, Shouyang & Lai, Kin Keung, 2016. "Fuel efficiency and emission in China's road transport sector: Induced effect and rebound effect," Technological Forecasting and Social Change, Elsevier, vol. 112(C), pages 188-197.

    More about this item

    JEL classification:

    • N12 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - U.S.; Canada: 1913-
    • N71 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - U.S.; Canada: Pre-1913
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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