Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/247148 
Year of Publication: 
2021
Series/Report no.: 
EHES Working Paper No. 218
Publisher: 
European Historical Economics Society (EHES), s.l.
Abstract: 
This paper investigates whether high borrowing costs deterred investment in sanitation infrastructure in late nineteenth-century Britain. Town councils had to borrow to fund investment, with considerable variation in interest rates across towns and over time. Panel regressions, using annual data from over eight hundred town councils, indicate that higher interest rates were associated with lower levels of infrastructure investment between 1887 and 1903. Instrumental variable regressions show that falling interest rates after 1887 stimulated investment and led to lower infant mortality. These findings suggest that Parliament could have expedited mortality decline by subsidizing loans or facilitating private borrowing.
Subjects: 
interest rates
public investment
sanitation
Britain
urban infrastructure
mortality decline
JEL: 
N23
N33
N43
N93
Document Type: 
Working Paper

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