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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. 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.
    2. 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.
    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.
    4. Starkie, David, 2013. "Transport infrastructure: Adding value," IEA Discussion Papers 50, Institute of Economic Affairs (IEA).
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