Strategy, solvency and the state : the development of the railway system of northern Scotland, 1844-74

This thesis investigates the factors that stimulated and sustained the development of
a railway system in northern Scotland in 1844-74 and draws contrasts with earlier
railway development in Scotland and England. No continuous railway routes ran
north of the Glasgow-Aberdeen axis in 1844, but, by 187 4, a railway system
extended to the far north of the highlands despite the absence of substantial
population or raw material sources.
The state, strongly influenced by the ideology of free market capitalism, was
reluctant to become involved in the planning or management of railways in Britain
with the result that the railway system evolved in an unplanned way, promoted and
managed by private enterprise and financed increasingly from a national capital
market. This thesis contends that railway development in northern Scotland does
not reflect this pattern. It questions whether the state perpetuated its detached
stance towards railway development in northern Scotland, to what extent this
northern railway system was planned, and how these relatively small railway
companies were able to obtain sufficient capital and avoid insolvency given the
unpromising economic conditions of the region. The thesis examines a coherent
plan devised and authorised by the state that set out the framework of a Scottish
railway network. It demonstrates that the remote northern railway system was
founded upon the cogent strategic planning of regional interests based in Aberdeen
and Inverness. It illustrates the substantial economies achieved in the costs of
establishing northern railways compared to earlier railway development to the south,
and the significance of local investment within them, increasingly made for the future
indirect returns anticipated from national trade and improved land values. The
critical importance of temporary credit in the financing of northern railways is
highlighted and, in particular, the major role played by the banking sector.