Imperialists, Native Rulers, and Private Companies: New Evidence on the Efficiency of Indian Railways, 1880-1913
Abstract: Using a new dataset on Indian railways, we study the effects of ownership structure on performance across public and private companies, within different types of public companies (such as those owned by the Government of India versus a Native State) and within individual companies between 1880 and 1913. Colonial India is an especially unique context because we can analyze the traditional public-private differences and also compare performance within public railways operated by the Imperial Government versus the Native States that faced differential capital costs and performance incentives. By focusing on different ownership structures within the same country and analyzing performance over a longer time period, we reduce the omitted variables bias associated with traditional cross-country comparisons and thus provide a stronger understanding of the relationship between ownership and efficiency.
