Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/259311 
Year of Publication: 
2001
Series/Report no.: 
Working Paper No. 2001-15
Publisher: 
Bar-Ilan University, Department of Economics, Ramat-Gan
Abstract: 
U.S. Railroads suffered repeated financial crises in the 19th and 20th Centuries. These crises were caused by a combination of high debt levels and strongly procyclical revenues and profits. Given the inherent instability of profits, why did railroads depend primarily on debt to finance their initial growth? I find that, over 1830-1885, railroads faced significant agency and control problems, which were partially mitigated by the use of debt. Around 1885, new developments reinforced the initial tendency towards debt-heavy capital structures.
Document Type: 
Working Paper

Files in This Item:
File
Size
153.82 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.