Productivity impulses from regional integration: lessons from road openings

Abstract

In recent years, assessment of wider economic impacts has become an integrated part of transportation appraisal in many developed countries. The practices have also spread to sparsely populated countries, for which the empirical evidences for such impacts remain thin. In this paper, we conduct a multi-level examination on productivity impulses of regional integration caused by road constructions in Coastal Southern Norway. We measure market access in the national road network by power and exponential distance decay, using local estimates for the distance decay parameters from Holmen (2022a) in our baseline specifications. Our endogeneity test and earlier studies suggest that productivity analyses of impulses from Norwegian road constructions do not suffer from reverse causality. Still, we operate with buffer zones of twenty traveling kilometers around each receiver of impulses from market access, where traveling times are held constant. Total factor productivity is pre-estimated, before the impacts of increased market access are assessed at firm and industry level. We find some indications of more commuting and regional industry restructuring subsequent to road openings. The most striking evidences are nevertheless that the openings neither appear to have enhanced productivity growth at firm level nor induced welfare-enhancing reallocation of factor inputs within or between local industries.

Market access and seaport efficiency: the case of container handling in Norway

“…We measure friction by travel time. Note that previous studies do not find any indications of reverse causality of productivity from Norwegian road construction (Eliasson et al 2015;Holmen 2022b).…”

Multidimensional Analysis of the Number of Passengers Transported by Air in Europe Between 2019-2022 in Terms of Economic Security

“…In the literature, passenger air transport is identified with the purposeful transport of people and cargo in the airspace from the starting point to the destination (Ficoń, 2004, p. 51). It covers all economic, technical and organizational activities aimed at the implementation of transport processes constituting a link in the global transport market (Adeniran & Obembe, 2020;Adeniran et al, 2021;Periokaitė & Dobrovolskienė, 2021;Holmen, 2022;Vennemo, 2023).…”