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Transport Infrastructure Investments as a Factor of Economic Growth of European Union Countries

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  • Butkus Mindaugas

    (Institute of Regional Development, Vilnius University Šiauliai Academy, Vytauto 84, Šiauliai LT-76352, Lithuania)

  • Mačiulytė-Šniukienė Alma

    (Department of Business Technologies and Entrepreneurship, Faculty of Business Management, Vilnius Gediminas Technical University, Saulėtekio al. 11, Vilnius LT-10223, Lithuania)

  • Matuzevičiūtė Kristina

    (Department of Economics Engineering, Faculty of Business Management, Vilnius Gediminas Technical University, Saulėtekio al. 11, Vilnius LT-10223, Lithuania)

Abstract

Territorial cohesion and improved accessibility are among the main objectives of the European Union (EU) Cohesion policy. Although there is a wealth of literature on the impact of investment in transport infrastructure on overall accessibility levels, only a few studies have tried to evaluate the possible link between transport infrastructure investment (TII) and economic growth in the EU. Our research aims to evaluate the impact of TII on economic growth in the EU. The methodology is based on nonlinear neoclassical specification, which includes a multiplicative term to evaluate if the absence of corruption mediates the effect of TII on growth. Our unbalanced panel data covers 27 EU countries (Cyprus is excluded due to missing data and the United Kingdom is a part of the sample) from 2000 through 2019. Our research confirms a positive and statistically significant impact of TII on economic growth but with a diminishing return. Estimating the absence of corruption as a possible moderator of the effect that TII has on growth shows that control of corruption plays a significant role in the TII growth nexus. We find that in countries with a low level of control of corruption, TII has a statistically significant negative effect on growth.

Suggested Citation

  • Butkus Mindaugas & Mačiulytė-Šniukienė Alma & Matuzevičiūtė Kristina, 2023. "Transport Infrastructure Investments as a Factor of Economic Growth of European Union Countries," TalTech Journal of European Studies, Sciendo, vol. 13(1), pages 150-176, June.
    • Handle: RePEc:vrs:bjeust:v:13:y:2023:i:1:p:150-176:n:1
    DOI: 10.2478/bjes-2023-0008
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    References listed on IDEAS

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    1. Riccardo Crescenzi & Marco Di Cataldo & Andrés Rodríguez-Pose, 2016. "Government Quality And The Economic Returns Of Transport Infrastructure Investment In European Regions," Journal of Regional Science, Wiley Blackwell, vol. 56(4), pages 555-582, September.
    2. Riccardo Crescenzi & Andrés Rodríguez-Pose, 2012. "Infrastructure and regional growth in the European Union," Papers in Regional Science, Wiley Blackwell, vol. 91(3), pages 487-513, August.
    3. Muvawala, Joseph & Sebukeera, Hennery & Ssebulime, Kurayish, 2021. "Socio-economic impacts of transport infrastructure investment in Uganda: Insight from frontloading expenditure on Uganda's urban roads and highways," Research in Transportation Economics, Elsevier, vol. 88(C).
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