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Highways and Economic Productivity: Interpreting Recent Evidence

  • Boarnet, Marlon G.

This paper reviews the recent literature on public infrastructure and economic productivity, with special attention to the particular case of highway infrastructure. Recent evidence suggests that, at the margin, highway infrastructure contributes little to state or national productivity. This is consistent with studies that show relatively small land use impacts from modern highways. Yet the idea that highways enhance economic health is common in the policy and planning communities. Two explanations can help reconcile this divergence between academic research and popular perception. First, some of the economic development observed near highways might not actually be caused by the highway. Second, some of the economic development near highways might be a shift of economic activity away from other areas. Either explanation suggests the need for reforms in highway project analysis and funding. Appropriate policy reforms and directions for future research are suggested.

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Paper provided by University of California Transportation Center in its series University of California Transportation Center, Working Papers with number qt4g79984s.

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Date of creation: 01 Oct 1995
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Handle: RePEc:cdl:uctcwp:qt4g79984s
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  1. Randall W. Eberts & Michael S. Fogerty, 1987. "Estimating the relationship between local, public and private investment," Working Paper 8703, Federal Reserve Bank of Cleveland.
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  17. Douglas Holtz-Eakin & Amy Schwartz, 1995. "Spatial productivity spillovers from public infrastructure: Evidence from state highways," International Tax and Public Finance, Springer, vol. 2(3), pages 459-468, October.
  18. Holtz-Eakin, Douglas, 1993. "State-specific estimates of state and local government capital," Regional Science and Urban Economics, Elsevier, vol. 23(2), pages 185-209, April.
  19. David Aschauer, 1988. "Is public expenditure productive?," Staff Memoranda 88-7, Federal Reserve Bank of Chicago.
  20. Randall W. Eberts, 1986. "Estimating the contribution of urban public infrastructure to regional growth," Working Paper 8610, Federal Reserve Bank of Cleveland.
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