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Interest Rates, Sanitation Infrastructure, and Mortality Decline in Nineteenth-Century England and Wales

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  • Jonathan Chapman

    (New York University Abu Dhabi)

Abstract

This paper investigates whether high borrowing costs deterred investment in sanitation infrastructure in late nineteenth-century Britain. Town councils had to borrow to fund investment, with considerable variation in interest rates across towns and over time. Panel regressions, using annual data from over eight hundred town councils, indicate that higher interest rates were associated with lower levels of infrastructure investment between 1887 and 1903. Instrumental variable regressions show that falling interest rates after 1887 stimulated investment and led to lower infant mortality. These findings suggest that Parliament could have expedited mortality decline by subsidizing loans or facilitating private borrowing.

Suggested Citation

  • Jonathan Chapman, 2021. "Interest Rates, Sanitation Infrastructure, and Mortality Decline in Nineteenth-Century England and Wales," Working Papers 0218, European Historical Economics Society (EHES).
    • Handle: RePEc:hes:wpaper:0218
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    File URL: https://www.ehes.org/wp/EHES_218.pdf
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    References listed on IDEAS

    as
    1. 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.
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    4. Chapman, Jonathan, 2018. "Democratic Reform and Opposition to Government Expenditure: Evidence from Nineteenth-Century Britain," Quarterly Journal of Political Science, now publishers, vol. 13(4), pages 363-404, October.
    5. TokeS. Aidt & Martin Daunton & Jayasri Dutta, 2010. "The Retrenchment Hypothesis and the Extension of the Franchise in England and Wales," Economic Journal, Royal Economic Society, vol. 120(547), pages 990-1020, September.
    6. David Cutler & Grant Miller, 2005. "The role of public health improvements in health advances: The twentieth-century United States," Demography, Springer;Population Association of America (PAA), vol. 42(1), pages 1-22, February.
    7. Brown, John C., 1988. "Coping with Crisis? The Diffusion of Waterworks in Late Nineteenth-Century German Towns," The Journal of Economic History, Cambridge University Press, vol. 48(2), pages 307-318, June.
    8. Jonathan Chapman, 2019. "The contribution of infrastructure investment to Britain's urban mortality decline, 1861–1900," Economic History Review, Economic History Society, vol. 72(1), pages 233-259, February.
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    More about this item

    Keywords

    interest rates; public investment; sanitation; Britain; urban infrastructure; mortality decline;
    All these keywords.

    JEL classification:

    • N23 - Economic History - - Financial Markets and Institutions - - - Europe: Pre-1913
    • N33 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: Pre-1913
    • N43 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: Pre-1913
    • N93 - Economic History - - Regional and Urban History - - - Europe: Pre-1913

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