Sources of figures and data
Railway Mania
Sources of figures and data
A list of where the figures in the diagrams and text come from in which sources. Click the heading to expand.
Read moreNumerical ledger (10 entries)
Read moreSources of the figures in the diagrams
| Diagram | What the figure represents | Value | Date/Period | Source and location |
|---|---|---|---|---|
| Fig. 1 | Diagram without numbers | — | — | — |
| Fig. 2 | Railway calls in 1847 (monthly) | 6.2 | 1847-01 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 2 | Railway calls in 1847 (monthly) | 1.4 | 1847-02 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 2 | Railway calls in 1847 (monthly) | 3.5 | 1847-03 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 2 | Railway calls in 1847 (monthly) | 3.2 | 1847-06 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 2 | Railway calls in 1847 (monthly) | 5.3 | 1847-07 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 2 | Railway calls in 1847 (monthly) | 2.3 | 1847-08 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 2 | Railway calls in 1847 (monthly) | 4.2 | 1847-09 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 2 | Railway calls in 1847 (monthly) | 3.8 | 1847-10 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 2 | Railway calls in 1847 (monthly) | 2.0 | 1847-11 | D. Morier Evans 1848 pp.54–56, 64–65, 71, 74, 98 |
| Fig. 3 | Length of railways authorized by Parliament per session | 91 | 1843 | Andrew Odlyzko 2010 pp.77–78, note 215 |
| Fig. 3 | Length of railways authorized by Parliament per session | 805 | 1844 | Andrew Odlyzko 2010 pp.77–78, note 215 |
| Fig. 3 | Length of railways authorized by Parliament per session | 2,700 | 1845 | Andrew Odlyzko 2010 pp.77–78, note 215 |
| Fig. 3 | Length of railways authorized by Parliament per session | 4,538 | 1846 | Andrew Odlyzko 2010 pp.77–78, note 215 |
| Fig. 3 | Length of railways authorized by Parliament per session | 1,354 | 1847 | Andrew Odlyzko 2010 pp.77–78, note 215 |
| Fig. 3 | Length of railways authorized by Parliament per session | 371 | 1848 | Andrew Odlyzko 2010 pp.77–78, note 215 |
| Fig. 4 | Bank rate 2.5% | — | September 7, 1844 | — |
| Fig. 4 | Railway share index peaks at 1,984 | — | August 8, 1845 | — |
| Fig. 4 | Bank rate 3.0%. Panic over the weekend | — | October 16, 1845 | — |
| Fig. 4 | Government letter. Banks lend at 8% | — | October 25, 1847 | — |
| Fig. 4 | Index at 673. 6,621 miles of railway in operation | — | 1850 | — |
Read moreWhat the sources tell us
The historical sources are divided into four groups. First, parliamentary records. The House of Commons debates of January 23, 26, and 29, 1846, the Chancellor of the Exchequer's speech of November 30, 1847, the Railway Regulation Act of 1844, and the Dissolution of Companies and Railway Commissioners Acts of 1846 were read in their original versions on Hansard and legislation.gov.uk. Second, the official table of the Bank of England's bank rate. Third, contemporary publications: Evans's (1848) *The Commercial Crisis 1847-1848*, Tooke's (1848) *A History of Prices*, Volume 4, and Francis's (1851) *A History of the English Railway*, Volume 2, were read for the sections covering 1845 to 1847. Fourth, academic research: Campbell and Turner (2012) and Campbell (2013) were read in their entirety, while for Odlyzko (2010), the introduction, chronology, conclusion, and tables were read. Mackay's 1852 edition was read as the source of the legends.
Some items are missing. The number and occupations of subscribers are based on Campbell and Turner's count from parliamentary lists; the original lists have not been read. The share price index was created by the authors from daily prices in the Railway Times; their paper was consulted, not the original tables. The table from The Times of 17 November 1845 was read from a transcription by Evans and Odlyzko. Statistics counting the total amount of calls, total losses, and the number of bankruptcies from 1846 to 1848 are not found in the sources cited here.
Research positions are divided. Campbell and Turner conclude from the registers that the majority of capital was provided by experienced investors, and that insider investments did not perform better than others. Campbell observes that even amidst the frenzy, similar assets were priced consistently, and that returns were inflated by the leverage of instalment payments. Odlyzko argues that the market was highly inefficient, seeing a "collective delusion" where investors ignored quantitative indicators showing that demand was insufficient for expected returns. Regarding the Panic of 1847, the Chancellor of the Exchequer cited the absorption of capital into grain and railways as the main cause, Lord Russell downplayed the importance of payment calls, the opposition blamed the 1844 Act and the bank's tightening in April, Tooke assessed that low interest rates from September 1844 had encouraged speculation, and Odlyzko holds that the panic had little effect on railway investment. These five views still coexist today.
Why so many people invested in railway shares that, in hindsight, were a poor deal is also an open question. Campbell and Turner list several candidates without deciding on any one: the lack of outlets for savings as the national debt was not increasing, "riding the bubble" behavior to sell out while prices were rising, the discounting of future profits at a high rate as the probability of adopting the new technology increased, and the political failure of Parliament not to narrow down the schemes in the autumn of 1845.
The sources for the numbers have been standardized. The bank rate is from the Bank of England's table, authorized mileage and cumulative investment are from Odlyzko's table and chronology, monthly calls are from Evans, and the estimate for parliamentary deposits is from the House of Commons debates. Even for the same event, descriptions differ depending on the date of announcement versus the date of effect, such as the 6% bank rate of September 30, 1847 (Bank's table) versus the announcements of September 23 and October 1 (Tooke's list of 13 changes). In the text, the dates from the Bank's table are used, and Tooke's list has been kept in the chronology.
Contemporary Records
- The Commercial Crisis 1847–1848: being facts and figures illustrative of the events of that important period, considered in relation to the three epochs of the Railway Mania, the Food and Money Panic, and the French Revolution
- A History of Prices, and of the State of the Circulation, from 1839 to 1847 inclusive; with a General Review of the Currency Question（vol. IV）
- A History of the English Railway; its Social Relations and Revelations. 1820–1845（vol. II）
Official Documents
- Bank Rate history — Changes in Bank Rate, Minimum Lending Rate, Minimum Band 1 Dealing Rate, Repo Rate and Official Bank Rate（HISTORICAL SINCE 1694）
- Railway Deposits — HC Deb 23 January 1846 vol 83 cc131–4
- Railway Bills — HC Deb 26 January 1846 vol 83 cc188–223
- Standing Orders — Railway Deposits — HC Deb 29 January 1846 vol 83 cc371–8
- Commercial Distress — HC Deb 30 November 1847 vol 95 cc374–477
Court Records
- An Act to attach certain Conditions to the Construction of future Railways authorized or to be authorized by any Act of the present or succeeding Sessions of Parliament; and for other Purposes in relation to Railways（Railway Regulation Act 1844）, 7 & 8 Vict. c. 85
- An Act to facilitate the Dissolution of certain Railway Companies（Railway Companies Dissolution Act 1846）, 9 & 10 Vict. c. 28
- An Act for constituting Commissioners of Railways, 9 & 10 Vict. c. 105
Institutional Accounts
Research
Popular Books
- Memoirs of Extraordinary Popular Delusions and the Madness of Crowds (2nd ed., vol. 1) Cited as the source of the common story. Not used for factual explanation.
Were the participants amateurs?
Experienced investors provided most of the capital. Clergy and women, 1.2%.
Gareth Campbell, John D. Turner 2012Investors, "mostly newcomers to the stock market," were caught in a collective delusion.
Andrew Odlyzko 2010Widows, clergy, servants, the middle class
John Francis 1851Was the market inefficient?
Quantitative indicators of demand were ignored. Highly inefficient.
Andrew Odlyzko 2010Similar assets were priced consistently, and returns were inflated by leverage (myopic rationality).
Gareth Campbell 2013Causes of the 1847 crisis
The absorption of capital into grain and railways acted upon an unsound basis of credit.
House of Commons 1847Lord Russell downplays calls. The causes were the 1844 Act and the April credit tightening.
House of Commons 1847The Bank's low interest rates under the 1844 Act encouraged speculation.
Thomas Tooke 1848The crisis had little effect on railway investment.
Andrew Odlyzko 2010Read moreBibliography (15 items)
- Dispelling the Myth of the Naive Investor during the British Railway Mania, 1845–46 Gareth Campbell, John D. Turner — Business History Review 86(1)・2012・Open source
- Deriving the railway mania Gareth Campbell — Financial History Review 20(1)・2013-02・Open source
- Collective Hallucinations and Inefficient Markets: The British Railway Mania of the 1840s Andrew Odlyzko — University of Minnesota / SSRN (preliminary version, January 15, 2010)・2010-01・Open source
- Bank Rate history — Changes in Bank Rate, Minimum Lending Rate, Minimum Band 1 Dealing Rate, Repo Rate and Official Bank Rate (HISTORICAL SINCE 1694) Bank of England・Open source
- Railway Deposits — HC Deb 23 January 1846 vol 83 cc131–4 House of Commons — Hansard 1803–2005 (UK Parliament)・1846-01-23・Open source
- Railway Bills — HC Deb 26 January 1846 vol 83 cc188–223 House of Commons — Hansard 1803–2005 (UK Parliament)・1846-01-26・Open source
- Standing Orders — Railway Deposits — HC Deb 29 January 1846 vol 83 cc371–8 House of Commons — Hansard 1803–2005 (UK Parliament)・1846-01-29・Open source
- Commercial Distress — HC Deb 30 November 1847 vol 95 cc374–477 House of Commons — Hansard 1803–2005 (UK Parliament)・1847-11-30・Open source
- An Act to attach certain Conditions to the Construction of future Railways authorized or to be authorized by any Act of the present or succeeding Sessions of Parliament; and for other Purposes in relation to Railways (Railway Regulation Act 1844), 7 & 8 Vict. c. 85 Parliament of the United Kingdom — King's Printer version as published on legislation.gov.uk (The National Archives)・1844-08-09・Open source
- An Act to facilitate the Dissolution of certain Railway Companies (Railway Companies Dissolution Act 1846), 9 & 10 Vict. c. 28 Parliament of the United Kingdom — King's Printer version as published on legislation.gov.uk (The National Archives)・1846-07-03・Open source
- An Act for constituting Commissioners of Railways, 9 & 10 Vict. c. 105 Parliament of the United Kingdom — King's Printer edition published on legislation.gov.uk (The National Archives)・1846-08-28・Open document
- The Commercial Crisis 1847–1848: being facts and figures illustrative of the events of that important period, considered in relation to the three epochs of the Railway Mania, the Food and Money Panic, and the French Revolution D. Morier Evans — London: Letts, Son and Steer, 1848 (scan from the Internet Archive)・1848・Open document
- A History of Prices, and of the State of the Circulation, from 1839 to 1847 inclusive; with a General Review of the Currency Question (vol. IV) Thomas Tooke — London: Longman, 1848 (scan from the Internet Archive)・1848・Open document
- A History of the English Railway; its Social Relations and Revelations. 1820–1845 (vol. II) John Francis — London: Longman, Brown, Green, & Longmans, 1851 (scan from the Internet Archive)・1851・Open document
- Memoirs of Extraordinary Popular Delusions and the Madness of Crowds (2nd ed., vol. 1) Charles Mackay — London: Office of the National Illustrated Library, 1852 (scan from the Internet Archive)・1852・Open document
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