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Profiting from Public Works: Financial Returns to Infrastructure and Investment Strategies during Britain's Industrial Revolution

Author

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  • Dan Bogart

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

Abstract

The infrastructure sector has the potential to generate wide differences in profits and economic outcomes. This paper examines financial returns and investment strategies for Britain’s turnpike roads in the early nineteenth century. There are three main findings. First, rates of return on capital invested and returns to bondholders were similar to competitive sectors. Second, there was significant variation in returns across trusts. Third, there is evidence that turnpike investors were driven by financial motives, although economic motives appear to be important in some cases. The findings have implications regarding the connection between infrastructure and Britain’s industrialization.

Suggested Citation

  • Dan Bogart, 2012. "Profiting from Public Works: Financial Returns to Infrastructure and Investment Strategies during Britain's Industrial Revolution," Working Papers 121304, University of California-Irvine, Department of Economics.
  • Handle: RePEc:irv:wpaper:121304
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    File URL: https://www.economics.uci.edu/files/docs/workingpapers/2012-13/bogart-04.pdf
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    References listed on IDEAS

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    1. Klein, Daniel B, 1990. "The Voluntary Provision of Public Goods? The Turnpike Companies of Early America," Economic Inquiry, Western Economic Association International, vol. 28(4), pages 788-812, October.
    2. Jacks, David S., 2011. "Foreign wars, domestic markets: England, 1793–1815," European Review of Economic History, Cambridge University Press, vol. 15(02), pages 277-311, August.
    3. Allen,Robert C., 2009. "The British Industrial Revolution in Global Perspective," Cambridge Books, Cambridge University Press, number 9780521868273, April.
    4. Dan Bogart, 2009. "Turnpike trusts and property income: new evidence on the effects of transport improvements and legislation in eighteenth-century England -super-1," Economic History Review, Economic History Society, vol. 62(1), pages 128-152, February.
    5. Bogart, Dan, 2005. "Did Turnpike Trusts Increase Transportation Investment in Eighteenth-Century England?," The Journal of Economic History, Cambridge University Press, vol. 65(02), pages 439-468, June.
    6. Alex Trew, 2010. "Infrastructure Finance and Industrial Takeoff in England," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 42(6), pages 985-1010, September.
    7. Carol H. Shiue & Wolfgang Keller, 2007. "Markets in China and Europe on the Eve of the Industrial Revolution," American Economic Review, American Economic Association, vol. 97(4), pages 1189-1216, September.
    8. Laffont,Jean-Jacques, 2005. "Regulation and Development," Cambridge Books, Cambridge University Press, number 9780521840187, April.
    9. Klein, Daniel & Majewski, John, 1991. "Economy, Community and Law: The Turnpike Movement in New York, 1797-1845," University of California Transportation Center, Working Papers qt61b022cr, University of California Transportation Center.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Alex Trew, 2016. "Endogenous Infrastructure Development and Spatial Takeoff," Discussion Paper Series, Department of Economics 201601, Department of Economics, University of St. Andrews, revised 17 Nov 2017.
    2. Dan Bogart, 2013. "The Transportation Revolution in Industrializing Britain: A Survey," Working Papers 121306, University of California-Irvine, Department of Economics.

    More about this item

    Keywords

    Monopoly; Regulation; Turnpike roads; Infrastructure; Britain; Industrial Revolution;

    JEL classification:

    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • N43 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: Pre-1913
    • N73 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: Pre-1913

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