Price Dynamics in England from 1820-1864: Corn, Trade Liberalization, and Railway Mania

Abstract

Using price and sales data from 309 markets in England from 1820-1864, I study the 1846 Corn Law trade liberalization in England. I show that the trade liberalization substantially reduced costs of consuming staple grains for the average consumer. Most importantly, I show that the liberalization had distributional effects where some markets experienced substantial price decline, whereas other markets experienced stagnant or even rising prices. The variation in price changes can be attributed to the varying degree to which the transportation network improved in the years leading up to the liberalization. Post-liberalization, access to infrastructure such as roads, waterways or railways turns out to be a good predictor of whether the prices declined or not in a particular market.