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Investment and Growth: The Impact of Britain's Post-War Trunk Roads Programme

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  • David Starkie

Abstract

In Great Britain, a basic inter-urban network of motorways was completed in a very short period between the end of 1959 and 1972. We calculate that this substantial investment had the potential to reduce most inter-urban journey times by about one third. In spite of this, a recent OECD study suggested that the investment had no discernible positive impact on the trend rate of economic growth. We attribute this outcome to a serious misalignment of the early investments with the then predominant flows of industrial and commercial traffics and a significant, and probably endogenous, increase in real wages in a road transport industry in which labour productivity was slow to improve. We conclude with a number of policy recommendations.

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  • David Starkie, 2015. "Investment and Growth: The Impact of Britain's Post-War Trunk Roads Programme," Economic Affairs, Wiley Blackwell, vol. 35(1), pages 60-74, February.
    • Handle: RePEc:bla:ecaffa:v:35:y:2015:i:1:p:60-74
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    1. Douglas Sutherland & Sonia Araujo & Balázs Égert & Tomasz Koźluk, 2009. "Infrastructure Investment: Links to Growth and the Role of Public Policies," OECD Economics Department Working Papers 686, OECD Publishing.
    2. Andrew Daly & Flavia Tsang & Charlene Rohr, 2014. "The Value of Small Time Savings for Non-business Travel," Journal of Transport Economics and Policy, University of Bath, vol. 48(2), pages 205-218, May.
    3. Daniel J. Graham, 2007. "Agglomeration, Productivity and Transport Investment," Journal of Transport Economics and Policy, University of Bath, vol. 41(3), pages 317-343, September.
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