Positive Externalities and the Public Provision of Transportation Infrastructure: An Evolutionary Perspective (original) (raw)
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The effects of transport infrastructure changes : a general equilibrium perspective
2013
Measures of the value of public investments are critical inputs into the policy making process. In the existing literature public investments are often valued through their effects on local equilibrium factor prices wages and land rents as first suggested by Rosen (1974) and Roback (1982). We extend this methodology to measure the value of public transport infrastructure, while taking into account the network character of this amenity. Furthermore, we disentangle and calculate the relative importance of various economic effects induced by transport infrastructure, including the effects on: modal split, spatial distribution of economic activities, firms’ productivity.
The Wider Economic Impacts of Transportation Infrastructure
2020
This proposal adopts a holistic approach to strategic transport investment by discussing the wider economic impacts (WEIs) analysis method in terms of several dominant and emerging methods. The WEIs analysis goes beyond the effects captured in a standard cost-benefit analysis (CBA). A CBA addresses the market for transport services and infrastructure access but neglects the wider impacts on other markets. These wider impacts usually relate to agglomeration, market power, and the behavioral adaptions of firms and households. The high uncertainty in land use changes indicates that WEIs tend to occur in different forms on multiple spatial scales, varying by place and time. Additionally, some activities, such as education, have no direct market value, but may indirectly contribute to the overall economic output and human capital development in cities and regions. Given that the conventional elasticity methods are not goal oriented, it is important to ensure that the WEIs analysis accounts for the stakeholder-specific costs and benefits. Assuming that it is possible to consider all WEIs through theoretical models, major efforts should focus on establishing and maintaining appropriate methodologies and tools. The social and environmental data needed to address biodiversity issues should also be improved and promoted. Complementary to the WEIs, understanding how the behavior of agents changes in response to the new transport options will help clarify the long-term implications of transportation. This will suggest new strategies (territorial appropriation), approaches/techniques to feasibility, and "place-based" interrelations, that is, specific interrelations in places. This last aspect is especially important in the current context of the COVID-19 pandemic, which has affected and will likely change transportation behaviors and transport demand in the dynamic future.
In this paper we show conditions under which the accumulation of public infrastructure capital over time may create the comparative advantage of the production of transport services and destroy that of the production of goods in a market equilibrium of a transit economy. We also show conditions under which it will not change comparative advantage. Moreover, we also show the conditions under which an environmental tax on pollution from transport will shift the specialization back to the production of goods. In the model used, specialization is determined by: the productivity of the sectors; the transit volume; the taxes raised for the use of roads; the world market prices of goods and transport services; and environmental taxes. Gains from trade are analysed and comparative-static properties of globalization and tax policy are discussed. This paper has been presented at the NAKE day, the KNIE day and in an internal seminar. I am grateful for the comments received. Responsibility is entirely mine. Note the difference in emphasis in these surveys. Haslinger 1 and Ziesemer emphasize developing country experience. Glomm and Ravikumar emphasize time-series investigations. Pfähler et al. implicitly emphasize panel-data investigations and therefore are a bit more sceptical on the relevance of extra investment. Other literature on international trade with public inputs 2 consists of contributions to static trade theory. McMillan (1978) considers the central planners optimum of 3 an enhanced Ricardian textbook trade model. The level of the stock of a public factor determines the productivity of the two sectors. The investment in the stock of public factors is produced using labour and the stock itself. We consider the market equilibrium of a transit economy with one good in the utility function. The second good is international transport services which pollute the natural environment. The stock of public factors in our model enhances only the productivity of the transport sector.
Socio-economic impact of transportation infrastructure
This paper explains the socioeconomic effects of transportation infrastructure. Many studies have shown that transportation infrastructure may have both beneficial and bad effects on people's lives and economic progress. As a result, well-planned transportation infrastructure leads to economic growth, which improves people's quality of life while reducing traffic congestion and resentment. Many scholars also agreed that infrastructure development has long been presented as a cure for poverty, and that current evidence reveals a correlation between economic growth and transportation infrastructure. Eventually, Public investments in services such as transportation infrastructure are seen as important drivers of long-term prosperity and build a framework for poor people to thrive and take advantage from the process of development.
Wider Economic Impacts in Transport Infrastructure Cost-Benefit Analysis – A Bridge Too Far?
Agenda - A Journal of Policy Analysis and Reform, 2015
Proponents of transport infrastructure have in recent decades sought to augment the estimated benefit of major projects beyond conventional cost-benefit analysis. Improved transport links are claimed to increase Marshallian external economies of scale; to reduce transport costs experienced by imperfectly competitive industries, and so induce them to increase their output; and to increase supply of labour, in response to lower transport costs, and thereby increase GDP and tax receipts. Estimates of the value of these three additional effects have resulted in multipliers and 'uprate factors' that appear to be applied by some government agencies to transport sector benefits calculated using conventional CBA. However, empirical estimates of these effects are likely to be exaggerated.
Transportation Capital in the US: A Multimodal General Equilibrium Analysis
SSRN Electronic Journal, 2000
This study introduces a new general equilibrium approach to evaluate economic impact of public transportation capital stock in the United States. By treating public transportation capital as separated factor accounts, the model enables us to assess the economic impact of public transportation stock for four modes: road, air, transit, and water transportation. The study provides a direct and easy way for policy maker and transportation planning practitioner to compare social and economic benefits of different modes of public transportation. Findings reveal that road stock has the highest contribution to the growth of gross domestic product (GDP) and levels of social welfare; public transit and other ground passenger transportation have the least impact on the U.S. economy among the four modes.
The Economic Development Effects of Transport Investments
This paper will set out to describe two of the main elements in the debate on transport and economic development. First it will argue that where there is already a well-connected transport infrastructure network, further investment will not on its own result in economic development. Transport infrastructure investment acts as a complement to other more important underlying conditions, which must be met if further economic development is to take place. Additional transport investment is not a necessary condition, but acts in a supporting role when other factors are at work. These factors will be presented as the necessary conditions that need to be met if economic development is to take place.
Measuring the benefits derived from a transportation investment
Transportation Research Part B: Methodological, 1982
This paper reviews the problems associated with application of the concept of consumers' surplus to the measurement of benefits derived from a transportation investment. This review is warranted since such measurement is very complicated when alternative modes or different paths are available to the users and benefit measures have been proposed which, on the surface, appear not to agree. In particular, as . and Agnello (19771, among others, have discussed, demand curves for interdependent modes will shift in response to a modal specific improvement, i.e. a unimodal investment, thereby complicating the measurement of consumers' surplus, The perspective taken in this paper resolves seeming inconsistencies in the literature regarding the directions of demand shifts and the correct measure to be used in calculating changes in consumers' surplus following an investment. This is accomplished by introducing an aggregate, origin-destination demand curve which is independent of the alternative modes actually available and from which traditional modal demands can be derived. An approach for deriving the modal demands from the aggregate demand and the behavioral assumptions behind the aggregate supply is described; the aggregate demand is used to unequivocably determine the directions of shifts in the modal demand curves due to specific modal investments. The resulting consistency of modal and aggregate demands is shown to lead to an unambiguous measure of total consumers' surplus variation. Extensions to include producers' surplus are also given.
Open Journal of Civil Engineering, 2019
Investing in large transport projects affects the (potential) economic development of metropolitan areas. Yet, very little critical research has been performed to understand how to assess these effects. The relationship between infrastructure investments and regional economic development is complex and indirect, and many theoretical and methodological difficulties remain. On the one hand, the assumption that investing in infrastructure is important to sustain economic growth is sometimes doubted. On the other hand, it is argued that investments in infrastructure enhance the accessibility of urban regions and that in the slipstream of such investments, social problems in urban regions can be tackled as well. Despite these contrasting views, there is at least a consensus that transport infrastructure development depends on economic development and vice versa. Yet, in many cases, the method of assessing economic impacts highly affects the results. Therefore, this paper focuses on a critical reflection of methods for estimating economic effects of infrastructure investments. A critical evaluation is made based on Indonesian and Japanese cases. After conducting in-depth desk research on both cases, we found that the broader effects on affected group of people tend to be overlooked due to the problems of time and space dimensions, the chain reaction of effects, and inappropriate data practices. The assessment on the appraisal processes tends to overlook the broader economic implication due to narrow focus and the concept of efficiency of economic theory.