In the United States, a paper railroad is a company in the railroad business which exists "on paper only": as a legal entity which does not own any track, locomotives, or rolling stock. Frequently, paper railroads were set up as subsidiaries by larger parent railroads, or formerly existed and operated under their old name but were subsumed when one or more smaller railroads merged. Paper railroads were also known as "non-operating subsidiaries" of the parent railroad. In many cases, paper railroads were still known as such even after plans to build them may have been canceled.
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