How can transportation policies affect growth? A theoretical analysis of the long-term effects of alternative mobility systems
AbstractWe present an example of how public policies affect the evolution of the economy by influencing consumption habits, life styles and work attitudes. In particular, we show that governments can boost long-run growth by moving public investment away from collective transportation systems and towards infrastructures necessary for using private vehicles. Indeed, by augmenting the relative convenience of using private mobility systems, which are those more costly for the households, the government induces them to increase their labour supply so as to afford larger expenditures in transportation. This has long-term welfare implications depending also on the negative externalities associated with transport.
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Bibliographic InfoArticle provided by Elsevier in its journal Economic Modelling.
Volume (Year): 31 (2013)
Issue (Month): C ()
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Web page: http://www.elsevier.com/locate/inca/30411
Endogenous growth; Public investment; Consumption habits; Labour supply; Negative externalities;
Find related papers by JEL classification:
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
- L91 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Transportation: General
- O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
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