This paper examines major privately-owned British railway companies before World War I. Quantitat... more This paper examines major privately-owned British railway companies before World War I. Quantitative evidence is presented on return on capital employed, total factor productivity growth, cost inefficiency, and speed of passenger services. There were discrepancies in performance across companies but ROCE and TFP typically fell during our period. Cost inefficiency rose before 1900 but then was brought under control as a profits collapse loomed. Without the discipline of either strong competition or effective regulation, managerial failure was common. This sector is an important qualification to the conventional wisdom that late-Victorian Britain did not fail.
This paper examines major privately-owned British railway companies before World War I. Quantitat... more This paper examines major privately-owned British railway companies before World War I. Quantitative evidence is presented on return on capital employed, total factor productivity growth, cost inefficiency, and speed of passenger services. There were discrepancies in performance across companies but ROCE and TFP typically fell during our period. Cost inefficiency rose before 1900 but then was brought under control as a profits collapse loomed. Without the discipline of either strong competition or effective regulation, managerial failure was common. This sector is an important qualification to the conventional wisdom that late-Victorian Britain did not fail.
W hen planning for new housing developments, we must make sure they are built where people actual... more W hen planning for new housing developments, we must make sure they are built where people actually want to live. With a growing population, government is under increasing pressure to build more and more housing developments. Previously used, or brownfield, land often offers an attractive alternative to building on greenfield sites. However, Tim Leunig warns that we must be certain that there is demand for new homes in these areas before we commit to redeveloping them at an often high cost.
Comment on Oxley's "Seat of death and terror" Originally published in Economic history review, 59... more Comment on Oxley's "Seat of death and terror" Originally published in Economic history review, 59 (3). pp.
Economists and economic historians want to know how much better life is today than in the past. F... more Economists and economic historians want to know how much better life is today than in the past. Fifty years ago economic historians found surprisingly small gains from 19th century US railroads, while more recently economists have found relatively large gains from electricity, computers and cell phones. In each case the implicit or explicit assumption is that researchers were measuring the value of a new good to society. In this paper we use the same techniques to find the value to society of making existing goods cheaper. Henry Ford did not invent the car, and the inventors of mechanised cotton spinning in the industrial revolution invented no new product. But both made existing products dramatically cheaper, bringing them into the reach of many more consumers. That in turn has potentially large welfare effects. We find that the consumer surplus of Henry Ford's production line was around 2% by 1923, 15 years after Ford began to implement the moving assembly line, while the mechanisation of cotton spinning was worth around 6% by 1820, 34 years after its initial invention. Both are large: of the same order of magnitude as consumer expenditure on these items, and as large or larger than the value of the internet to consumers. On the social savings measure traditionally used by economic historians, these process innovations were worth 15% and 18% respectively, making them more important than railroads. Our results remind us that process innovations can be at least as important for welfare and productivity as the invention of new products.
This paper uses new micro-level US data to reexamine productivity leadership in cotton spinning c... more This paper uses new micro-level US data to reexamine productivity leadership in cotton spinning c. 1900. We find that output aggregation problems make the Census unreliable in this industry, and that Lancashire, not New England was the productivity leader for almost every type of yarn. This is true both for the operation of a given machinery type, and when comparing machinery typical in each country. Higher capital and labour productivity rates imply that Lancashire's combination of a more favourable climate, external economies of scale and more experienced workers dominated the advantages that New England firms derived from greater scale.
osbornes-comprehensive-spendingreview-has-yielded-few-surprises/ George Osborne's Comprehensive S... more osbornes-comprehensive-spendingreview-has-yielded-few-surprises/ George Osborne's Comprehensive Spending Review has yielded few surprises Oct 22 2010 Tim Leunig sees the emergence of a smaller state, but has concerns for growth prospects.
The Higher Education W hite Paper is a good start at introducing real competition between univers... more The Higher Education W hite Paper is a good start at introducing real competition between universities for academic places The Higher Education White Paper, released today, proposes to make student 85,000 places 'contestable' between universities over the next two years, allow institutions to take on more high achieving A-level students, and create up to 20,000 places for universities that charge a yearly fee of less than £7,500. Tim Leunig welcomes the White Paper and its proposals, but argues that the proposed changes will do little to improve access to and the quality of, the student experience. 'Real' competition is needed.
More than one third of universities will charge students the maximum fees of £9,000 in 2012. Tim ... more More than one third of universities will charge students the maximum fees of £9,000 in 2012. Tim Leunig argues that the Office of Fair Access has proved itself to be toothless in its negotiations with universities who want to charge such figures and students will suffer-if not through an unquestioned increase in fees in 2013 then through institutions that risk bankruptcy The facts speak for themselves. University fees will average £8,393 from 2012-3. Even after fee waivers for students from poorer backgrounds, the average will be £8,161. One in three universities will charge £9,000 for all courses.
This was a Tory budget from a Tory Chancellor Mar 21 2012 Tim Leunig analyses today's budget and ... more This was a Tory budget from a Tory Chancellor Mar 21 2012 Tim Leunig analyses today's budget and argues that this was a case of the Tories looking after their own, particularly with regards to the 50p tax rate. The budget also saw an end to claims to be a tax reforming government, although there were positive moves on pensions and income taxes for those on minimum wage. This was very much a Tory budget, from a Tory Chancellor. George Osborne cut the top rate of income tax, and did so on the grounds it wasn't raising much money. The reason it didn't raise much money is because people were able to avoid it, mainly by taking income before it was introduced, or delaying taking it until after it was abolished.
With the budget on the horizon, the government should take the opportunity to create a fairer and... more With the budget on the horizon, the government should take the opportunity to create a fairer and more equal tax system for pensioners Mar 5 2012 The British government is rightly committed to raising the tax allowance argues Tim Leunig. However, more could be done to ensure that affluent pensioners are not unfairly benefitting from the tax free lump sum and the national insurance exemption options.
This paper examines major privately-owned British railway companies before World War I. Quantitat... more This paper examines major privately-owned British railway companies before World War I. Quantitative evidence is presented on return on capital employed, total factor productivity growth, cost inefficiency, and speed of passenger services. There were discrepancies in performance across companies but ROCE and TFP typically fell during our period. Cost inefficiency rose before 1900 but then was brought under control as a profits collapse loomed. Without the discipline of either strong competition or effective regulation, managerial failure was common. This sector is an important qualification to the conventional wisdom that late-Victorian Britain did not fail.
This paper examines major privately-owned British railway companies before World War I. Quantitat... more This paper examines major privately-owned British railway companies before World War I. Quantitative evidence is presented on return on capital employed, total factor productivity growth, cost inefficiency, and speed of passenger services. There were discrepancies in performance across companies but ROCE and TFP typically fell during our period. Cost inefficiency rose before 1900 but then was brought under control as a profits collapse loomed. Without the discipline of either strong competition or effective regulation, managerial failure was common. This sector is an important qualification to the conventional wisdom that late-Victorian Britain did not fail.
W hen planning for new housing developments, we must make sure they are built where people actual... more W hen planning for new housing developments, we must make sure they are built where people actually want to live. With a growing population, government is under increasing pressure to build more and more housing developments. Previously used, or brownfield, land often offers an attractive alternative to building on greenfield sites. However, Tim Leunig warns that we must be certain that there is demand for new homes in these areas before we commit to redeveloping them at an often high cost.
Comment on Oxley's "Seat of death and terror" Originally published in Economic history review, 59... more Comment on Oxley's "Seat of death and terror" Originally published in Economic history review, 59 (3). pp.
Economists and economic historians want to know how much better life is today than in the past. F... more Economists and economic historians want to know how much better life is today than in the past. Fifty years ago economic historians found surprisingly small gains from 19th century US railroads, while more recently economists have found relatively large gains from electricity, computers and cell phones. In each case the implicit or explicit assumption is that researchers were measuring the value of a new good to society. In this paper we use the same techniques to find the value to society of making existing goods cheaper. Henry Ford did not invent the car, and the inventors of mechanised cotton spinning in the industrial revolution invented no new product. But both made existing products dramatically cheaper, bringing them into the reach of many more consumers. That in turn has potentially large welfare effects. We find that the consumer surplus of Henry Ford's production line was around 2% by 1923, 15 years after Ford began to implement the moving assembly line, while the mechanisation of cotton spinning was worth around 6% by 1820, 34 years after its initial invention. Both are large: of the same order of magnitude as consumer expenditure on these items, and as large or larger than the value of the internet to consumers. On the social savings measure traditionally used by economic historians, these process innovations were worth 15% and 18% respectively, making them more important than railroads. Our results remind us that process innovations can be at least as important for welfare and productivity as the invention of new products.
This paper uses new micro-level US data to reexamine productivity leadership in cotton spinning c... more This paper uses new micro-level US data to reexamine productivity leadership in cotton spinning c. 1900. We find that output aggregation problems make the Census unreliable in this industry, and that Lancashire, not New England was the productivity leader for almost every type of yarn. This is true both for the operation of a given machinery type, and when comparing machinery typical in each country. Higher capital and labour productivity rates imply that Lancashire's combination of a more favourable climate, external economies of scale and more experienced workers dominated the advantages that New England firms derived from greater scale.
osbornes-comprehensive-spendingreview-has-yielded-few-surprises/ George Osborne's Comprehensive S... more osbornes-comprehensive-spendingreview-has-yielded-few-surprises/ George Osborne's Comprehensive Spending Review has yielded few surprises Oct 22 2010 Tim Leunig sees the emergence of a smaller state, but has concerns for growth prospects.
The Higher Education W hite Paper is a good start at introducing real competition between univers... more The Higher Education W hite Paper is a good start at introducing real competition between universities for academic places The Higher Education White Paper, released today, proposes to make student 85,000 places 'contestable' between universities over the next two years, allow institutions to take on more high achieving A-level students, and create up to 20,000 places for universities that charge a yearly fee of less than £7,500. Tim Leunig welcomes the White Paper and its proposals, but argues that the proposed changes will do little to improve access to and the quality of, the student experience. 'Real' competition is needed.
More than one third of universities will charge students the maximum fees of £9,000 in 2012. Tim ... more More than one third of universities will charge students the maximum fees of £9,000 in 2012. Tim Leunig argues that the Office of Fair Access has proved itself to be toothless in its negotiations with universities who want to charge such figures and students will suffer-if not through an unquestioned increase in fees in 2013 then through institutions that risk bankruptcy The facts speak for themselves. University fees will average £8,393 from 2012-3. Even after fee waivers for students from poorer backgrounds, the average will be £8,161. One in three universities will charge £9,000 for all courses.
This was a Tory budget from a Tory Chancellor Mar 21 2012 Tim Leunig analyses today's budget and ... more This was a Tory budget from a Tory Chancellor Mar 21 2012 Tim Leunig analyses today's budget and argues that this was a case of the Tories looking after their own, particularly with regards to the 50p tax rate. The budget also saw an end to claims to be a tax reforming government, although there were positive moves on pensions and income taxes for those on minimum wage. This was very much a Tory budget, from a Tory Chancellor. George Osborne cut the top rate of income tax, and did so on the grounds it wasn't raising much money. The reason it didn't raise much money is because people were able to avoid it, mainly by taking income before it was introduced, or delaying taking it until after it was abolished.
With the budget on the horizon, the government should take the opportunity to create a fairer and... more With the budget on the horizon, the government should take the opportunity to create a fairer and more equal tax system for pensioners Mar 5 2012 The British government is rightly committed to raising the tax allowance argues Tim Leunig. However, more could be done to ensure that affluent pensioners are not unfairly benefitting from the tax free lump sum and the national insurance exemption options.
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