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Were British railway companies well-managed in the early twentieth century?

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  • Crafts, Nicholas
  • Leunig, Tim
  • Mulatu, Abay

Abstract

This is a revised version of a previous working paper, of the same name, which incorporates corrections to errors in our estimates of TFP growth. This paper examines major privately-owned British railway companies before World War I. Quantitative evidence is presented on return on capital employed, total factor productivity growth, cost inefficiency, and speed of passenger services. There were discrepancies in performance across companies but ROCE and TFP typically fell during our period. Cost inefficiency rose before 1900 but then was brought under control as a profits collapse loomed. Without the discipline of either strong competition or effective regulation, managerial failure was common. This sector is an important qualification to the conventional wisdom that late-Victorian Britain did not fail.

Suggested Citation

  • Crafts, Nicholas & Leunig, Tim & Mulatu, Abay, 2010. "Were British railway companies well-managed in the early twentieth century?," Economic History Working Papers 27889, London School of Economics and Political Science, Department of Economic History.
  • Handle: RePEc:ehl:wpaper:27889
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    File URL: http://eprints.lse.ac.uk/27889/
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    References listed on IDEAS

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    1. A. J. Arnold, 1999. "Profitability and capital accumulation in British industry during the transwar period, 1913–1924," Economic History Review, Economic History Society, vol. 52(1), pages 45-68, February.
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    Cited by:

    1. Crafts, Nicholas, 2011. "British Relative Economic Decline Revisited," CAGE Online Working Paper Series 42, Competitive Advantage in the Global Economy (CAGE).

    More about this item

    JEL classification:

    • N0 - Economic History - - General
    • L91 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Transportation: General
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • B1 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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