INDUSTRY STUDIES OF THE RELATIONSHIP BETWEEN HIGHWAY INFRASTRUCTURE INVESTMENT AND PRODUCTIVITY

This paper summarizes an extensive empirical study of the links between infrastructure (net highway stocks) and production costs for 369 four digit SIC manufacturing industries for 1969-86. It is the first study to examine the impact of specific public capital (highways) on the production structure of disaggregate industry. A translog cost function is estimated and net and gross substitution elasticities are calculated. There are mixed results across industries and years. Costs increase with highway stocks in some cases, but on average, an increase in highway stocks is associated with modest reductions in manufacturing costs. The cost reductions primarily comes about from reduced labor and capital inputs. Curiously, the data show inventory costs generally higher with a larger highway stock.

  • Corporate Authors:

    University of British Columbia, Vancouver

    Faculty of Commerce and Business Administration
    Vancouver, British Columbia  Canada  V6T 1Z2
  • Authors:
    • Holleyman, C
  • Publication Date: 1996-3

Language

  • English

Media Info

Subject/Index Terms

Filing Info

  • Accession Number: 00721172
  • Record Type: Publication
  • Files: TRIS, ATRI
  • Created Date: May 2 1996 12:00AM