The Role of Transport Infrastructure in Regional Economic Development

The aim of the present dissertation is two-fold. Firstly, it tries to understand whether the economic effects of transport infrastructure provision exist and are significant enough to be accounted for when making policy decisions. A SCGE model for Norway (PINGO) is used for the empirical analysis. The main conclusion is that although provision of transport infrastructure by itself does not lead to economic growth, its positive welfare effects are quite significant in monetary terms and increasing over time if one takes into account future production growth. Secondly, the dissertation develops a generic SCGE model incorporating location decisions of households and firms, housing markets, different market imperfections and explicit representation of real transport network. The functionality of the proposed model is illustrated using a hypothetical example.