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National transportation networks, market access, and regional economic growth

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  • Herzog, Ian

Abstract

I estimate interregional transportation’s effect on local economic activity by studying the Interstate Highway System. To estimate transportation’s effects on county employment and wages, I develop a new instrumental variables strategy: isolating market access growth caused by incidental connections to rural counties. I find that through market access highways increased employment, had small and delayed wage effects, and that instruments correct for downward bias. A structural model interprets reduced-form results as agglomeration and congestion forces strengthening after 1980. Counterfactual simulations suggest that Interstates’ effects were highly heterogeneous and that additions to early Interstate plans were less valuable than the system’s core.

Suggested Citation

  • Herzog, Ian, 2021. "National transportation networks, market access, and regional economic growth," Journal of Urban Economics, Elsevier, vol. 122(C).
    • Handle: RePEc:eee:juecon:v:122:y:2021:i:c:s0094119020300875
    DOI: 10.1016/j.jue.2020.103316
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    3. Augustin Ignatov, 2024. "European highways and the geographic diffusion of economic activities from agglomerations to less urbanised areas," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 51(2), pages 351-377, May.
    4. Fragoso Januário, João & Costa, Álvaro & Oliveira Cruz, Carlos & Miranda Sarmento, Joaquim & Faria e Sousa, Vítor, 2021. "Transport infrastructure, accessibility, and spillover effects: An empirical analysis of the Portuguese real estate market from 2000 to 2018," Research in Transportation Economics, Elsevier, vol. 90(C).
    5. Stefan Pauly & Fernando Stipanicic, 2022. "The Creation and Diffusion of Knowledge: Evidence from the Jet Age," SciencePo Working papers Main hal-04067326, HAL.
    6. Klein, Alexander, 2023. "From the Manufacturing Belt to the Rust Belt. Spatial Inequalities in the United States: An Interdisciplinary Literature Review," CAGE Online Working Paper Series 657, Competitive Advantage in the Global Economy (CAGE).
    7. YOO Sunbin & KUMAGAI Junya & KAWASAKI Kohei & HONG Sungwan & ZHANG Bingqi & SHIMAMURA Takuya & MANAGI Shunsuke, 2022. "Double-edged Trains: Economic outcomes and regional disparity of high-speed railways," Discussion papers 22060, Research Institute of Economy, Trade and Industry (RIETI).
    8. Garcia-López, Miquel-Àngel & Herranz-Loncán, Alfonso & Tassinari, Filippo & Viladecans-Marsal, Elisabet, 2023. "Paving the way to modern growth: The Spanish Bourbon roads," Explorations in Economic History, Elsevier, vol. 90(C).
    9. Taylor Jaworski & Carl Kitchens & Sergey Nigai, 2023. "Highways And Globalization," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 64(4), pages 1615-1648, November.
    10. Badura, Ondřej & Melecký, Aleš & Melecký, Martin, 2023. "Liberalizing passenger rail: The effect of competition on local unemployment," Economics of Transportation, Elsevier, vol. 36(C).
    11. Ignatov, Augustin, 2024. "European highway networks, transportation costs, and regional income," Regional Science and Urban Economics, Elsevier, vol. 104(C).
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    13. Wu, Bingyu & Levinson, David M., 2024. "A multi-modal analysis of the effect of transport on population and productivity in China," Journal of Transport Geography, Elsevier, vol. 116(C).
    14. Barde, Sylvain & Klein, Alexander, 2021. "Transportation Costs in the Age of Highways: Evidence from United States 1955-2010," CAGE Online Working Paper Series 597, Competitive Advantage in the Global Economy (CAGE).
    15. Zhiying Ji & Yuting Huang, 2023. "The Impact of Highway Infrastructure on Population Mobility: Evidence from a Sample of 800 Counties and Districts (2000–2019) in China," Sustainability, MDPI, vol. 15(20), pages 1-17, October.
    16. Stefan Pauly & Fernando Stipanicic, 2022. "The Creation and Diffusion of Knowledge: Evidence from the Jet Age," Working Papers hal-04067326, HAL.
    17. Miquel-Àngel Garcia-López & Alfonso Herranz-Loncán & Filippo Tassinari & Elisabet Viladecans-Marsal, 2021. "Paving the way to modern growth. Evidence from Bourbon roads in Spain," Working Papers 0209, European Historical Economics Society (EHES).
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    More about this item

    JEL classification:

    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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