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Public highway spending and state spillovers in the USA

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  • Alfredo Pereira
  • Jorge Andraz

Abstract

The empirical results reported in this paper suggest that only about 20% of the aggregate effects of public investment in highways in the US are captured by the direct effects on each state output of public investment in the state itself. The remaining 80% correspond to the spillover effects from public investment in highways in other states. This result may provide an answer to the paradox in the literature that the findings of large effects at the aggregate level have not been matched at the regional level. This is because regional analysis has typically ignored the possible existence of spillover effects.

Suggested Citation

  • Alfredo Pereira & Jorge Andraz, 2004. "Public highway spending and state spillovers in the USA," Applied Economics Letters, Taylor & Francis Journals, vol. 11(12), pages 785-788.
  • Handle: RePEc:taf:apeclt:v:11:y:2004:i:12:p:785-788
    DOI: 10.1080/1350485042000254593
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    References listed on IDEAS

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    1. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March.
    2. Garcia-Mila, Teresa & McGuire, Therese J & Porter, Robert H, 1996. "The Effect of Public Capital in State-Level Production Functions Reconsidered," The Review of Economics and Statistics, MIT Press, vol. 78(1), pages 177-180, February.
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    Cited by:

    1. Valter Di Giacinto & Giacinto Micucci & Pasqualino Montanaro, 2012. "Network effects of public transport infrastructure: Evidence on Italian regions," Papers in Regional Science, Wiley Blackwell, vol. 91(3), pages 515-541, August.
    2. Alfredo Marvão Pereira & Rui Manuel Pereira, 2017. "On the Effects of Infrastructure Investments on Industrial CO2 Emissions in Portugal," GEE Papers 0081, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Oct 2017.
    3. Alfredo Marvão Pereira & Rui Manuel Pereira, 2017. "Why Virtuous Supply-Side Effects and Irrelevant Keynesian Effects are not Foregone Conclusions: What we Learn from an Industry-Level Analysis of Infrastructure Investments in Portugal," GEE Papers 0076, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Aug 2017.
    4. Ertugrul Deliktas & A. Önder & Metin Karadag, 2009. "The spillover effects of public capital on the Turkish private manufacturing industries in the geographical regions," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 43(2), pages 365-378, June.
    5. Alfredo Marvão Pereira & Rui Manuel Pereira, 2017. "Infrastructure Investment, Labor Productivity, and International Competitiveness: The Case of Portugal," GEE Papers 0071, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Jun 2017.
    6. Alfredo Marvão Pereira & Rui M. Pereira, 2015. "Is All Infrastructure Investment Created Equal? The Case of Portugal," Working Papers 156, Department of Economics, College of William and Mary.
    7. Alfredo Pereira & Jorge Andraz, 2012. "On the economic and budgetary effects of investments in SCUTS: the Portuguese toll-free highways," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 48(1), pages 321-338, February.
    8. Valter Di Giacinto & Giacinto Micucci & Pasqualino Montanaro, 2012. "The Macroeconomic Impact of Infrastructures: A Literature Review and Empirical Analysis on the Case of Italy," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 1, March.
    9. Alfredo Marvão Pereira & Oriol Roca-Sagales, 2007. "Public infrastructure and regional asymmetries in Spain," Revue d'économie régionale et urbaine, Armand Colin, vol. 0(3), pages 503-519.
    10. Heinz Handler & Andreas Knabe & Bertrand Koebel & Margit Schratzenstaller & Sven Wehke, 2005. "The Impact of Public Budgets on Overall Productivity Growth," WIFO Working Papers 255, WIFO.
    11. Álvarez, Inmaculada C. & Barbero, Javier & Zofío, José L., 2016. "A spatial autoregressive panel model to analyze road network spillovers on production," Transportation Research Part A: Policy and Practice, Elsevier, vol. 93(C), pages 83-92.
    12. Alfredo Marvão Pereira & Rui M. Pereira, 2016. "Identifying Priorities in Infrastructure Investment in Portugal," Working Papers 157, Department of Economics, College of William and Mary.
    13. Alfredo Marvão Pereira & Rui Manuel Pereira, 2017. "Infrastructure Investment in Portugal and the Traded/Non-Traded Industry Mix," GEE Papers 0078, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Sep 2017.
    14. Alfredo M. Pereira & Jorge M. Andraz, 2013. "On The Economic Effects Of Public Infrastructure Investment: A Survey Of The International Evidence," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 38(4), pages 1-37, December.
    15. Ganelli, Giovanni & Tervala, Juha, 2010. "Public infrastructures, public consumption, and welfare in a new-open-economy-macro model," Journal of Macroeconomics, Elsevier, vol. 32(3), pages 827-837, September.
    16. Alfredo M. Pereira & Jorge M. Andraz, 2012. "On The Economic Effects Of Investment In Railroad Infrastructures In Portugal," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 37(2), pages 79-107, June.
    17. Alfredo Pereira & Jorge Andraz, 2012. "On the regional incidence of highway investments in the USA," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 48(3), pages 819-838, June.
    18. Alfredo M. Pereira & Jorge M. Andraz, 2010. "On the Economic and Fiscal Effects of Investments in Road Infrastructures in Portugal," International Economic Journal, Taylor & Francis Journals, vol. 25(3), pages 465-492, September.
    19. Alfredo M. Pereira & Martin B. Schmidt, 2007. "Structural Breaks in Public Infrastructure Investment in the U.S," Working Papers 55, Department of Economics, College of William and Mary.
    20. Alfredo Pereira & Jorge Andraz, 2012. "On the effects of highway investment on the regional concentration of economic activity in the USA," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 11(3), pages 165-170, December.
    21. Jiwattanakulpaisarn, Piyapong & Noland, Robert B. & Graham, Daniel J., 2010. "Causal linkages between highways and sector-level employment," Transportation Research Part A: Policy and Practice, Elsevier, vol. 44(4), pages 265-280, May.
    22. Alfredo M. Pereira & Jorge M. Andraz, 2008. "On the Regional Incidence of Public Investment in Highways in the USA," Working Papers 70, Department of Economics, College of William and Mary, revised 15 Sep 2010.
    23. Sylvain Leduc & Daniel J. Wilson, 2012. "Should transportation spending be included in a stimulus program? a review of the literature," Working Paper Series 2012-15, Federal Reserve Bank of San Francisco.
    24. Piyapong Jiwattanakulpaisarn & Robert B. Noland & Daniel J. Graham, 2012. "Marginal Productivity of Expanding Highway Capacity," Journal of Transport Economics and Policy, University of Bath, vol. 46(3), pages 333-347, September.
    25. repec:eee:touman:v:50:y:2015:i:c:p:257-267 is not listed on IDEAS

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