ABSTRACT
Speculative bubbles often accompany emerging revolutionary technologies. The industrial revolution in Britain offers two classic examples of innovation: canals and railways. At the dawn of the industrial revolution canals were the principal innovation in transportation infrastructure. The first railroad designed to compete directly with the canals was the Liverpool and Manchester Railway Company, authorized in 1826 and opened in 1830. Directors of the Liverpool, Manchester, and Newcastle Junction Railway, for instance, secretly kept most of the shares for themselves and issued only a fraction to the public. Throughout the boom, however, the railway-friendly press dismissed concerns about the unsupportable growth of railways as "erroneous" and "alarmist". The most notable achievement of the sector in 1825 was the establishment of Stockton and Darlington Railway Company as the first publicly owned, non-stationary steam-powered passenger-railway company in England.
