Railroads and Micro-regional Growth in Prussia
Ifo Institute, Munich, 2012
Ifo Working Paper No. 127
![](https://www.ifo.de/DocImg/IfoWorkingPaper-127.jpg?c=1689237012)
We study the effect of railroad access on urban population growth. Using GIS techniques, we match triennial population data for roughly 1000 cities in nineteenth-century Prussia to georeferenced maps of the German railroad network. We find positive short- and long-term effects of having a station on urban growth for different periods during 1840–1871. Causal effects of (potentially endogenous) railroad access on city growth are identified using instrumental variable and fixed-effects estimation techniques. Our instrument identifies exogenous variation in railroad access by constructing straight-line corridors between terminal stations. Counterfactual models using pre-railroad growth yield no evidence in support of the hypothesis that railroads appeared as a consequence of a previous growth spurt.