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Review of Methods for Estimating the Economic Impact of Transportation Improvements

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Author Info
Michael Iacono
David Levinson () (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)

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Abstract

Transportation analysts and the public decision-makers they support are confronted with a broad range of analytical tools for estimating the economic impacts of improvements to trans- portation networks. Many of the available models operate at different scales and have distinctly different structures, making them more or less appropriate for analyzing the impacts of differ- ent types of projects. Here, we review several of the economic methods and models that have been developed for analyzing the impact of transportation improvements, giving special atten- tion to types of projects that add highway capacity in urban areas. We review project-based methods, including beneÞt-cost analysis and several analytical software tools developed by the Federal Highway Administration (FHWA) for economic analysis of transportation investment. We then move on to aggregate and disaggregate-level econometric methods, including regional economic models, hedonic price functions, production functions and cliometric analyses. We also devote some attention to the role of induced demand in economic evaluation, since it is of- ten one of the most uncertain and confounding factors faced by those charged with conducting economic evaluation of transportation projects.

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File URL: http://nexus.umn.edu/Papers/EstimatingEconomicImpact.pdf
File Format: application/pdf
File Function: First version, 2008
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Publisher Info
Paper provided by University of Minnesota: Nexus Research Group in its series Working Papers with number 000041.

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Date of creation: 2008
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Publication status: Published in working paper
Handle: RePEc:nex:wpaper:estimatingeconomicimpact

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Postal: Dept. of Civil Engineering, 500 Pillsbury Drive SE, Minneapolis, MN 55455
Phone: +01 (612) 625-6354
Fax: +01 (612) 626-7750
Web page: http://nexus.umn.edu
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Related research
Keywords: Economic Impact; Benefit-Cost Analysis;

Find related papers by JEL classification:
R41 - Urban, Rural, and Regional Economics - - Transportation Systems - - - Transportation: Demand, Supply, and Congestion
R48 - Urban, Rural, and Regional Economics - - Transportation Systems - - - Government Pricing; Regulatory Policies
D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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This page was last updated on 2009-11-10.


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