Scandinavian Working Papers in Economics

African Economic History Working Paper,
African Economic History Network

No 30/2016: "For the public benefit": Railways in the British Cape Colony

Alfonso Herranz-Loncán () and Johan Fourie ()
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Alfonso Herranz-Loncán: University of Barcelona
Johan Fourie: Stellenbosch University

Abstract: Built mostly to support the early mining industry, the Cape Colony’s railways reduced the cost of transport to the interior and increased labor productivity in the Colony from 1859 to 1905 by, we calculate, 30 percent. Little of the gains went to the state-owned company: the Cape parliament seems always to have seen the railways as a means to development. But the politically overrepresented western parts of the Colony gained much more than underrepresented areas like Basutoland or the Transkei. While boosting the economy, the railways also had distributional effects, with consequences for racial segregation in twentieth-century South Africa.

Keywords: railways; infrastructure; public goods; South Africa; social savings

JEL-codes: H40; N40; O10

35 pages, October 13, 2016

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