Effects of Road Investments on Economic Output and Induced Travel Demand: Evidence for Urbanized Areas in the United States

The objective of this study is to analyze the effects of road transportation investment on economic output and induced travel demand. Data for U.S. urbanized areas are analyzed within a dynamic panel vector autoregression model to test whether the effects of transportation-induced economic growth and travel demand can be empirically validated. The results show that investment in road capacity increases average economic growth while simultaneously inducing additional growth in traffic (vehicle miles traveled). Indeed, a general failure of investment to alleviate levels of congestion is found; this finding suggests that productivity shifts are brought about through a net increase in the scale of travel and associated interactions rather than improved network performance as measured by travel times. The evidence also shows that congestion forms part of the decision criterion used to allocate investments in road capacity. If improvements in network performance are to be achieved in a climate of travel demand growth, demand management techniques may be more effective than capacity expansion.

• Record URL:
  https://doi.org/10.3141/2297-20
• Summary URL:
  http://scholar.google.com/scholar_lookup?title=Effects+of+Road+Investments+on+Economic+Output+and+Induced+Travel+Demand%3a+Evidence+for+Urbanized+Areas+in+the+United+States&author=P.+Melo&author=D.+Graham&author=S.+Canavan&publication_year=2012
• Availability:
  • Find a library where document is available. Order URL: http://www.trb.org/Main/Blurbs/168502.aspx
• Authors:
  • Melo, Patricia C
  • Graham, Daniel J
  • Canavan, Shane
• Publication Date: 2012

Language

• English

Media Info

• Media Type: Print
• Features: Figures; References; Tables;
• Pagination: pp 163–171
• Monograph Title: Finance, Pricing, Economics, and Equity Issues
• Serial:
  • Transportation Research Record: Journal of the Transportation Research Board
  • Issue Number: 2297
  • Publisher: Transportation Research Board
  • ISSN: 0361-1981

Subject/Index Terms

• TRT Terms: Economic development; Highway capacity; Investments; Output; Panel studies; Productivity; Roads; Traffic congestion; Travel demand; Travel demand management; Urban areas
• Uncontrolled Terms: Induced travel
• Geographic Terms: United States
• Subject Areas: Economics; Finance; Highways; Policy; I10: Economics and Administration;

Filing Info

• Accession Number: 01370972
• Record Type: Publication
• ISBN: 9780309262989
• Report/Paper Numbers: 12-1568
• Files: TRIS, TRB, ATRI
• Created Date: May 25 2012 9:31AM