How good was the profitability of British Railways, 1870-1912?
Mitchell, B. R. (Brian R.), Chambers, D. (David) and Crafts, Nicholas. (2011) How good was the profitability of British Railways, 1870-1912? Economic History Review, Vol.64 (No.3). pp. 798-831. ISSN 0013-0117
This is the latest version of this item.
Official URL: http://dx.doi.org/10.1111/j.1468-0289.2010.00550.x
This article provides new estimates of the return on capital employed (ROCE) for major British railway companies. It shows that ROCE was generally below the cost of capital after the mid-1870s and fell until the turn of the century. Addressing cost inefficiency issues could have restored ROCE to an adequate level in the late 1890s but not in 1910. Declines in ROCE hit share prices and investors made little or no money in real terms after 1897. Optimal portfolio analysis shows that, while railway securities were attractive to investors before this date, they would have been justified in rushing to the exits thereafter.
|Item Type:||Journal Article|
|Subjects:||T Technology > TF Railroad engineering and operation
H Social Sciences > HE Transportation and Communications
|Divisions:||Faculty of Social Sciences > Economics|
|Library of Congress Subject Headings (LCSH):||British Railways, Railroads -- Great Britain, Railroads -- Fares -- Great Britain, Great Britain -- Economic conditions -- 19th century|
|Series Name:||Warwick economic research papers|
|Journal or Publication Title:||Economic History Review|
|Place of Publication:||Coventry|
|Number of Pages:||45|
|Page Range:||pp. 798-831|
|Access rights to Published version:||Open Access|
|Version or Related Resource:||Mitchell, B., Chambers, D. and Crafts, N.F.R. (2009). How good was the profitability of British Railways, 1870-1912?. [Coventry] : University of Warwick, Economics Department. (Warwick economic research papers, no.859).|
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How good was the profitability of British Railways, 1870-1912? (deposited 04 Sep 2009 09:59)
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