MEASURING INDUSTRIAL STAGNATION: THE CASE OF THE US RAILROADS

This paper first applies to railroads the tools of modern fiscal risk analysis, using the long-term series of holding period rates of return on railroad shares to derive a measure of industrial stagnation. This analysis is then used to gain added insights into the industry's transition from growth to stagnation. While fundamental disequilibrium produces a continuing low rate of return, railroads have succeeded in raising substantial capital on a continuing basis despite frequent bankruptcies and financial crises by resorting to financial innovations. The equipment trust certificate is cited as an example, an investment instrument which effectively shields the investor from the riskiness of enterprise. This has enabled railroads to raise debt capital at a relatively low-risk premium.

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  • Corporate Authors:

    Blackwell Publishers

    108 Cowley Road
    Oxford,   United Kingdom  OX4 1JF
  • Authors:
    • Dunbar, RLM
    • Sarnat, M
  • Publication Date: 1980-3

Media Info

  • Features: Figures; References; Tables;
  • Pagination: p. 255-268
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 00331897
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Jun 12 1981 12:00AM