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The spatial impacts of a massive rail disinvestment program: the Beeching Axe

Gibbons, Stephen and Heblich, Stephan and Pinchbeck, Ted (2018) The spatial impacts of a massive rail disinvestment program: the Beeching Axe. CEP Discussion Papers (CEPDP1563). Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Abstract

Transport investment is a popular policy instrument and many recent studies have investigated whether new infrastructure generates economic benefits and has spatial economic impacts. Our work approaches the question differently and looks at what happens when a substantial part of a national railway network is dismantled, as happened during the 1950s, 60s and 70s in Britain. Part of this disinvestment occurred following controversial reports on railway profitability and structure in the early 1960s – a course of action known colloquially as ‘the Beeching Axe’ after the author of the reports. The removal of railways is often blamed for the decline of rural areas and peripheral towns in post-war Britain. This rail disinvestment program was targeted at removal of underused and unprofitable lines and not specifically targeted at local economic performance. Even so, we find that there is a relationship between pre-war population decline and the depth of the rail cuts in the post 1950 period. Conditional on these pre-trends, we show that loss of access by rail did cause relative population decline, decline in the proportion of skilled workers, and decline in the proportion of young people in affected areas. The elasticity of population with respect to changes in centrality (or market access) is around 0.3 in our main estimates. Instrumental variables estimates based on the network structure of the cuts yield higher elasticities. An implication of these findings is that rail transport infrastructure plays an important role in shaping the spatial structure of the economy.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk/
Additional Information: © 2018 The Authors
Divisions: Centre for Economic Performance
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HE Transportation and Communications
JEL classification: H - Public Economics > H5 - National Government Expenditures and Related Policies > H54 - Infrastructures; Other Public Investment and Capital Stock
R - Urban, Rural, and Regional Economics > R1 - General Regional Economics
R - Urban, Rural, and Regional Economics > R4 - Transportation Systems
Sets: Research centres and groups > Centre for Economic Performance (CEP)
Series: Working Papers > CEP Discussion Papers
Date Deposited: 11 Jan 2019 10:36
Last Modified: 11 Jan 2019 10:36
Funders: Economic and Social Research Council
URI: http://eprints.lse.ac.uk/id/eprint/91684

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