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Published online by Cambridge University Press: 03 February 2011
Approximately two years ago Stanley Lebergott took issue with the finding “that the rise of the railroads was relatively unimportant” to the American economy of the nineteenth century (p. 438). Lebergott dis-missed the low estimates of social savings as “startling but uninteresting,” and offered an alternative estimate of railroad importance. He asked the important question “by how much the railroad reduced real costs of transport from those that would have prevailed under a regime of wagoners and boatmen” (p. 441). He approached the answer by way of two other questions. Given cost and technological data, “what was the maximum volume of goods that could be distributed per year by a mile of canal and by a mile of railroad where both could reasonably be built? And how great was that volume per dollar of investment?” (p. 422). Using nineteenth-century data in his inimitably artistic manner, Lebergott fashioned an answer suggesting that the consequences of railroad construction were “surely the stuff of significant economic change” (p. 466).
1 Lebergott, Stanley, “United States Transport Advance and Externalities,” The Journal Of Economic History, XXVI (12 1966) 437–461CrossRefGoogle Scholar. The page references throughout this text all refer to the above article.
2 Lebergott, Stanley, “Labor Force and Employment, 1800-1960,” Studies in Income and Wealth, National Bureau of Economic Research, Vol. 30 (New York: Columbia University Press, 1966), p. 191Google Scholar.
3 Historical Statistics of the United States, Colonial Times to 1957, Washington, D.C., 1960, series Q-29Google Scholar.
4 It is not entirely clear whether investment in rolling stock is included in Lebergott's investment per mile figure. The canal figure used by Lebergott was obtained From the work of Cranmer. Cranmer presented his estimates as though they excluded such costs, but he was criticized by Segal for inadvertently including nonconstruction costs in calculating total investment for some canals. ( Cranmer, Jerome, “Canal Investment, 1815-1860,” Studies in Income and Wealth, National Bureau of Economic Research, Vol. 24 (Princeton: Princeton University Press, 1960), pp. 547–64Google Scholar. The comment by Segal follows Cranmer's article. See specifically p. 565.)
For railroads Lebergott used a figure ($27, 000) quite close to Wicker's $26, 000 estimate, which apparently excludes investment in rolling stock. Lebergott does not use Poor's estimate of $34, 600 per mile because he felt it was too high due to the high cost of land in New England. It might also be high because it includes investment in rolling stock. See the comment by Charles Kennedy on Wicker's estimates. E. R. Wicker, “Railroad Investment Before the Civil War,” Studies in Income and Wealth (NBER Vol. 24), pp. 503-24.
Thus Lebergott may have made an estimate of investment in rolling stock, but if so it appears to be inadvertent and incomplete.
5 Computed at 6 percent interest, the figure used by Lebergott (p. 456).