Economic Development from Capital Investment in Transportation Systems

ABSTRACT

Capital investment in transportation systems has two success sources: Public and private funding. Economic development in a region is heavily dependent on efficient transportation systems. Consequently, transportation projects usually receive higher priority from state and local government planners and leaders. The subject of public capital investment in highway transportation projects and the subsequent economic developments are presented in this paper. Impacts of capital investments in highway systems on economic development are studied and the results of these studies together with the methods for evaluation of economic benefits are also discussed in this paper. Various economic benefits produced include expansion of existing businesses and location of new businesses in a region. Methods of measuring economic benefits in a region depend on a number of factors. Some critical success factors are: (1) increased per capita income, (2) reduced cost of highway transportation, (3) increased consumer spending, and (4) trend of population growth. These factors are crucial in measuring economic benefits that could be obtained from investments in highway projects. Finally, a method of predicting economic development over various alternatives of highway spending is presented.

KEYWORDS:

• Capital investment
• economic development
• employment growth
• private funding
• population growth
• productivity
• public funding
• tourism
• highway transportation