This paper aims to determine the impact of transport infrastructure on local development in Dalmatia. To examine the direct, indirect and feedback effects, a spatial Durbin model was used on a sample of 131 local administrative units in a period from 2010 to 2018. Since transport infrastructure varies very little over the 9 years, the spatial‐fixed effect model was not appropriate. In fact, the financial crisis paved the way for the time‐fixed effect model. The impacts were determined by estimating the direct, indirect and overall effects for the road network as a whole, as well as for each individual road category. Besides, the analysis was done for the coastline, hinterland, and islands to estimate the effects for spatially heterogeneous areas. The results vary, in terms of strength and statistical significance, with spatial heterogeneity, but also with different road classifications. In hinterland, direct and total impacts are positive, on the other hand direct, indirect and total effects on the coastline are not statistically significant. This shows us the complexity of the research area and indicates the prudence of researching at the lowest possible level and with indicators of road infrastructure as analytical as possible.

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