Efficiency among private railway companies in a weakly regulated system: the case of Britain's railways in 1893-1912

Mulatu, Abay and Crafts, Nicholas (2005) Efficiency among private railway companies in a weakly regulated system: the case of Britain's railways in 1893-1912. Working papers in large-scale technological change (08/05). Department of Economic History, London School of Economics and Political Science, London, UK.

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Abstract

This paper uses a stochastic cost frontier model to investigate the efficiency of Britain’s private railways during the period 1893-1912. We find that there was substantial inefficiency in the industry with no sign of reduction over time. Our main conclusion is that principal agent problems were pervasive in railway management at this time. Our results suggest that private ownership per se is not sufficient to promote efficiency in the railway industry; it should be supported by competition for franchises and price-capping regulation as in the 1990s.

Item Type:	Monograph (Working Paper)
Official URL:	http://www.lse.ac.uk/collections/economicHistory/
Additional Information:	© 2005 Nicholas Crafts
Divisions:	Economic History
Subjects:	H Social Sciences > HC Economic History and Conditions T Technology > TF Railroad engineering and operation D History General and Old World > D History (General) > D204 Modern History D History General and Old World > DA Great Britain
Date Deposited:	05 Feb 2009 14:46
Last Modified:	13 Sep 2024 19:56
Projects:	R000239536
Funders:	Economic and Social Research Council
URI:	http://eprints.lse.ac.uk/id/eprint/22552

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