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Regional Effects of Port Infrastructure: A Spatial CGE Application to Brazil

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Author Info

  • Eduardo A. Haddad

    (Fipe, Sao Paulo, Brazil, Department of Economics, University of Sao Paulo, Brazil, ehaddad@usp.br)

  • Geoffrey J. D. Hewings

    (Regional Economics Applications Laboratory, University of Illinois at Urbana-Champaign, USA)

  • Fernando S. Perobelli

    (Department of Economics, Federal University of Juiz de Fora, Brazil)

  • Raul A. C. dos Santos

    (Fipe, Sao Paulo, Brazil, Department of Economics, University of Sao Paulo, Brazil)

Abstract

This article attempts to elucidate one of the mechanisms that link trade barriers, in the form of port costs, and subsequent growth and regional inequality. Prior attention has focused on inland or link costs, but port costs can be considered as a further barrier to enhancing trade liberalization and growth. In contrast to a highway link, congestion at a port may have severe impacts that are spread over space and time whereas highway link congestion may be resolved within several hours. Since a port is part of the transportation network, any congestion/ disruption is likely to ripple throughout the hinterland. In this sense, it is important to model properly the role nodal components play in the context of spatial models and international trade. In this article, a spatial computable general equilibrium (CGE) model that is integrated to a transport network system is presented to simulate the impacts of increases in port efficiency in Brazil. The role of ports of entry and ports of exit are explicitly considered to grasp the holistic picture in an integrated interregional system. Measures of efficiency for different port locations are incorporated in the calibration of the model and used as the benchmark in our simulations. Three scenarios are evaluated: (1) an overall increase in port efficiency in Brazil to achieve international standards; (2) efficiency gains associated with decentralization in port management in Brazil; and (3) regionally differentiated increases in port efficiency to reach the boundary of the national efficiency frontier.

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Bibliographic Info

Article provided by in its journal International Regional Science Review.

Volume (Year): 33 (2010)
Issue (Month): 3 (July)
Pages: 239-263

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Handle: RePEc:sae:inrsre:v:33:y:2010:i:3:p:239-263

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Keywords: computable general equilibrium; port infrastructure; Brazil; transportation network; impact analysis;

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Cited by:
  1. Giesecke, James A. & Madden, John R., 2013. "Regional Computable General Equilibrium Modeling," Handbook of Computable General Equilibrium Modeling, Elsevier.
  2. Romeo Danielis & Tullio Gregori, 2013. "An input-output-based methodology to estimate the economic role of a port: The case of the port system of the Friuli Venezia Giulia Region, Italy," Maritime Economics and Logistics, Palgrave Macmillan, vol. 15(2), pages 222-255, June.

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