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Inter-modal Network Externalities and Transport Development: Evidence from Roads, Canals, and Ports during the English Industrial Revolution


  • Dan Bogart

    () (Department of Economics, University of California-Irvine)


How does the development of one transport mode influence the development of another? This paper uses time-series data to test whether inter-model network externalities influenced the development of road, canal, and port infrastructure in England from 1760 to 1830. The main finding is that road development had a positive effect on canal development. The results suggest that the option value of investing in a canal in the future diminished when nearby road improvements were initiated because there was less uncertainty about future profits from canal tolls. They also suggest a reinterpretation of road transport in the Industrial Revolution and point to the general importance of inter-modal network externalities.

Suggested Citation

  • Dan Bogart, 2008. "Inter-modal Network Externalities and Transport Development: Evidence from Roads, Canals, and Ports during the English Industrial Revolution," Working Papers 070812, University of California-Irvine, Department of Economics.
  • Handle: RePEc:irv:wpaper:070812

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    References listed on IDEAS

    1. N. F. R. Crafts & C. K. Harley, 1992. "Output growth and the British industrial revolution: a restatement of the Crafts-Harley view," Economic History Review, Economic History Society, vol. 45(4), pages 703-730, November.
    2. Pindyck, Robert S, 1991. "Irreversibility, Uncertainty, and Investment," Journal of Economic Literature, American Economic Association, vol. 29(3), pages 1110-1148, September.
    3. Robert J. Barro & Xavier Sala-I-Martin, 1992. "Public Finance in Models of Economic Growth," Review of Economic Studies, Oxford University Press, vol. 59(4), pages 645-661.
    4. David M. Levinson, 2002. "Financing Transportation Networks," Books, Edward Elgar Publishing, number 2308.
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    Cited by:

    1. David Levinson, 2009. "Introduction to the Special Issue on the Evolution of Transportation Network Infrastructure," Networks and Spatial Economics, Springer, vol. 9(3), pages 289-290, September.
    2. Louis Grange & Felipe González & Ignacio Vargas & Rodrigo Troncoso, 2015. "A Logit Model With Endogenous Explanatory Variables and Network Externalities," Networks and Spatial Economics, Springer, vol. 15(1), pages 89-116, March.
    3. César Ducruet & Laurent Beauguitte, 2014. "Spatial Science and Network Science: Review and Outcomes of a Complex Relationship," Networks and Spatial Economics, Springer, vol. 14(3), pages 297-316, December.

    More about this item


    Inter-modal network externalities; British transport; Industrial Revolution;

    JEL classification:

    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • R50 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - General
    • N73 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: Pre-1913

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    1. Historical Economic Geography


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