Abstract: Two Roads to the Transportation Revolution: Early Corporations in the U.K. and the United States
The United Kingdom and the United States were world leaders in transport development by the mid-nineteenth century. We compare the evolution of transportation organizations in the United Kingdom and the United States with a focus on the differences in their chartering regimes. We show that U.S. state governments incorporated far more transportation companies per persons at far lower fees than did the U.K. Parliament. Our initial investigation suggests that low population densities in the United States, which limited the profits of many transportation companies, encouraged U.S. states to minimize the costs of incorporation. The greater degree of development in the U.K.—including much higher population densities—allowed companies to pay substantial profits, but also led to more interest groups that might oppose projects. Parliament charged higher chartering fees, which covered the higher costs of producing political consensus. Fees may have also represented rents for Parliament and its members. A greater degree of democracy in the United States and a more decentralized political environment may have contributed to the differences in chartering regimes, but we view the economic dynamics as more important.