Doctoral Dissertation Research: Creating Property Rights Over the King's Highway -- Institutional Change and the Development of Road Infrastructure in Early Modern England.

University Of California-Los Angeles, Los Angeles CA

Investigators

Abstract

This dissertation research examines the implications of infrastructure privatization from a historical perspective. It investigates an institutional change that took place in eighteenth century England, in which responsibility for providing road investment was transferred from local units of government to private organizations known as turnpike trusts. The trustees of these organizations funded road improvements by levying a regulated schedule of tolls on the users of the road, while their counterparts in local government funded improvements with local taxes. The first part of the dissertation will determine whether this form of privatization increased the level of road expenditure in eighteenth century England. It will use the funds provided by this grant to collect data on the investment behavior of turnpike trusts and local governments. Then it will use this data to compare the expenditure levels of local government with the corresponding turnpike trust after a privatization occurs. The dissertation research also develops and tests a theory that explains why privatization increased the level of infrastructure investment in the context of eighteenth century England. It emphasizes the externalities created by inter-jurisdictional traffic and suggests that these externalities limited investment under the decentralized system. It then argues that the levying of tolls resulted in the internalization of the costs and benefits of road improvement and ultimately encouraged more investment. Besides focusing on externalities, the theory also emphasizes the transfer of 'control-rights' to private actors with a concentrated interest in infrastructure improvement. It argues that landowners and industrialists lobbied for the right to establish turnpike trusts so that they could ensure that complimentary transportation investments were undertaken. The second part of the dissertation will estimate the contribution of transportation infrastructure investment to economic growth in England during the eighteenth century. Data on transportation costs will be collected for several different highways, which will contribute to an estimate of productivity growth in the road transportation sector. The project will then econometrically estimate the relationship between road investment and productivity growth in this sector. Next, it will broaden the analysis and show that there is a correlation between the formation of turnpike trusts and other local investments, including land improvements and the adoption of factories and steam engines. This will lend support to the hypothesis that there is a complimentary relationship between infrastructure investment and capital investment. Finally, the project will investigate the econometric relationship between transportation investment and growth in land rents and wages during the eighteenth century, providing yet another assessment of the economic value of these investments in the context of the British economy in this period. .