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An Application Of An Integrated Transport Network - Multiregional Cge Model To The Calibration Of Synergy Effects Of Highway Investments


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  • Euijune Kim
  • Geoffrey Hewings


A transportation network-multiregional CGE model is applied to estimate the synergy effects of a set of highway projects on value added by region and industrial sector. This synergy effect is defined as a difference between the summation of the net GDP increase from the development of each highway sub-link without spatial linkage and the change in GDP resulting from the concurrent development of all links with spatial linkages. Among nine east-west highways in Korea, the East-West 9 highway increases the GDP by 0.3% over the 30-year time period horizon, with 0.016% of the GDP due to the synergy effect. The East-West 9 highway has the largest synergy effect of US$0.164 billion per year on the manufacturing sector of Kwangju Metropolitan Area, resulting in a gain in a regional GRP per capita of US$15.88 per year. Since most synergy effects are generated in less developed regions, highway development can contribute to the reduction in regional disparities.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Economic Systems Research.

Volume (Year): 21 (2009)
Issue (Month): 4 ()
Pages: 377-397

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Handle: RePEc:taf:ecsysr:v:21:y:2009:i:4:p:377-397

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Keywords: Computable general equilibrium model; Transportation investment; Synergy effect; Regional social accounting matrix;


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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.


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