{"title":"The Economics of Speed: The Electrification of the Streetcar System and the Decline of Mom-and-Pop Stores in Boston, 1885–1905","authors":"Wei You","doi":"10.1257/app.20180795","DOIUrl":null,"url":null,"abstract":"Small firms dominated the American economy in the nineteenth century, and they still dominate in many developing economies today. This paper tests whether geographic market segmentation due to underdeveloped intracity transportation technology precludes the emergence of large retail/wholesale stores. I exploit the natural experiment of Boston’s rapid electrification from its previous horse-drawn streetcar system, which occurred between 1889 and 1896. Analyzing newly digitized data, I find that rail-connected locations experienced a sharp decline in the share of sole proprietorships among food retail/wholesale establishments after the electrification relative to off-rail locations. Changes in market access due to streetcar electrification can explain this effect. (JEL L25, L81, L92, N71, N91, R41)","PeriodicalId":48212,"journal":{"name":"American Economic Journal-Applied Economics","volume":null,"pages":null},"PeriodicalIF":5.5000,"publicationDate":"2021-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"American Economic Journal-Applied Economics","FirstCategoryId":"96","ListUrlMain":"https://doi.org/10.1257/app.20180795","RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"ECONOMICS","Score":null,"Total":0}
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Abstract
Small firms dominated the American economy in the nineteenth century, and they still dominate in many developing economies today. This paper tests whether geographic market segmentation due to underdeveloped intracity transportation technology precludes the emergence of large retail/wholesale stores. I exploit the natural experiment of Boston’s rapid electrification from its previous horse-drawn streetcar system, which occurred between 1889 and 1896. Analyzing newly digitized data, I find that rail-connected locations experienced a sharp decline in the share of sole proprietorships among food retail/wholesale establishments after the electrification relative to off-rail locations. Changes in market access due to streetcar electrification can explain this effect. (JEL L25, L81, L92, N71, N91, R41)
期刊介绍：
American Economic Journal: Applied Economics publishes papers covering a range of topics in applied economics, with a focus on empirical microeconomic issues. In particular, we welcome papers on labor economics, development microeconomics, health, education, demography, empirical corporate finance, empirical studies of trade, and empirical behavioral economics.
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