Estimating the social return to transport infrastructure: A price-difference approach applied to a quasi-experiment

Li, Peilin; Yu, Chen

doi:10.1016/j.jce.2012.09.004

Cited by 19 publications

(14 citation statements)

References 20 publications

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“…Given the solid and sound economic growth in China, any potential overcapacity is a necessary sacrifice for the associated sectoral development and can be eventually converted to a strong impetus for the country's sustainable progress. A similar conclusion was reached in a quasi-experiment in western China by [34], who applied a price-difference approach and confirmed that the increased shipping capacity of transportation makes for an appreciable social return to public investment. From the angle of industrial agglomeration, the work in [35] utilized Chinese data from 285 cities during 2004-2013 and presented dynamic spatial econometric results that infrastructure improvement and sharing along with industrial agglomeration distinctly increase energy allocation and scale efficiency, reduce the costs for transaction and transportation, and furthermore stimulate business transformation and upgrade capacity and technology.…”

Section: Public Infrastructure Investment: Overcapacitysupporting

confidence: 68%

Does Public Infrastructure Breed Consumption Downgrade and Overcapacity in China? A DSGE Approach on Macroeconomic Effects

Lang

Qiu-yi

2019

Sustainability

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As the most influential emerging and developing country in Asia, China has attached great importance to the construction of infrastructural facilities, laying stress on its pivotal role in sustainable growth. Recently, however, a pessimistic mood about the term “consumption downgrade” continues to emerge, ascribing the dip in people’s disposable income to real estate bubbles stemming from too much government infrastructure spending. This paper collects empirical evidence, develops a Dynamic Stochastic General Equilibrium (DSGE) framework, regards Productive Government Expenditure (PGE) as a critical endogenous variable, and investigates thoroughly its overall effects on key indicators concerning economic growth and sustainable development. Results show that household consumption indeed responds directly and negatively confronting a sudden increase of public infrastructure investment in China, yet aggregate output is instead boosted. On top of that, productive capacity does not present a supposed reduction, but a promotion under the PGE shock. These findings indicate that so-called “consumption downgrade” delivers the wrong message of weak productivity; capacity utilization is in essence improved by vigorous government support for infrastructure construction, which ultimately benefits continuously-stable social sustainability in the long term.

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Section: Public Infrastructure Investment: Overcapacitysupporting

confidence: 68%

Does Public Infrastructure Breed Consumption Downgrade and Overcapacity in China? A DSGE Approach on Macroeconomic Effects

Lang

Qiu-yi

2019

Sustainability

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“…Some researchers tend to focus on the global impacts of sustainability while others prefer to deal with microlevel issues (List 2007;Li and Chen 2013;Zhang et al 2008). …”

Section: Introductionmentioning

confidence: 99%

“…• The estimation methods for sustainability-related costs for highway projects are often inconsistent (Li and Chen 2013): some use socioeconomic approaches, while others use technical/engineering approaches. Because of the professional orientation, these methods have in-built subjectivity and cannot cope with overall sustainability measures and expectations from the stakeholders.…”

Section: Introductionmentioning

confidence: 99%

Managing cost implications for highway infrastructure sustainability

Goh

Yang

2014

Int. J. Environ. Sci. Technol.

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Highway construction works have significant bearings on all aspects of sustainability. With the increasing level of public awareness and government regulatory measures, the construction industry is experiencing a cultural shift to recognise, embrace and pursue sustainability. Stakeholders are now keen to identify sustainable alternatives and the financial implications of including them on a life cycle basis. They need tools that can aid the evaluation of investment options. To date, however, there have not been many financial assessments on the sustainability aspects of highway projects. This is because the existing life cycle costing analysis models tend to focus on economic issues alone and are not able to deal with sustainability factors. This paper provides insights into the current practice of life cycle cost analysis, and the identification and quantification of sustainability-related cost components in highway projects through literature review, questionnaire surveys and semi-structured interviews. The results can serve as a platform for highway project stakeholders to develop practical tools to evaluate highway investment decisions and reach an optimum balance between financial viability and sustainability deliverables.

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“…OLS regressions comparing the economic performances of treated and untreated regions are confronted with unobservable endogenous factors such as infrastructure location, which is not chosen at random. The main solution to this issue is to use a quasiexperimental approach (e.g., Li and Chen, 2013;Martincus and Blyde, 2013;Xu, 2015) or appropriate instrumental variables such as planned routes (e.g., Baum-Snow, 2007) and historical routes (e.g., Duranton and Turner, 2012).…”

Section: Methodsmentioning

confidence: 99%

The Locational Dynamics of Manufacturing in China's Counties: Influence of Expressway Investment

Zhou

Liang

2016

Journal of Regional Science

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This study investigates the impact of expressway investment in China's counties. By identifying expressway accessibility through toll station locations, we estimate the manufacturing distribution along expressways for 2001-2005. We find that expressway accessibility promotes manufacturing employment for inland counties by around 41 percent; however, for coastal counties that already have high road density and dense manufacturing layouts, the returns from new expressways are small. Furthermore, counties close to large cities benefit more from expressway accessibility than do counties that are far from them. The gap first increases in the period of expressway construction and then decreases as expressway effects are smoothed.

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Estimating the social return to transport infrastructure: A price-difference approach applied to a quasi-experiment

Cited by 19 publications

References 20 publications

Does Public Infrastructure Breed Consumption Downgrade and Overcapacity in China? A DSGE Approach on Macroeconomic Effects

Does Public Infrastructure Breed Consumption Downgrade and Overcapacity in China? A DSGE Approach on Macroeconomic Effects

Managing cost implications for highway infrastructure sustainability

The Locational Dynamics of Manufacturing in China's Counties: Influence of Expressway Investment

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