Chapter 6 - The Econometrics of Transport Infrastructures

Abstract

In this chapter, we discuss the econometric approaches that have been used in the literature to evaluate the impact of transport infrastructures on growth and other economic outcomes. First, we discuss the role played by economic theory in informing the empirical analysis. The role played by the latter can in fact be seen as relatively minor in some approaches (as in vector auto regression analysis and, to some extent, in the counterfactual impact evaluation literature); by way of contrast, economic theory seems to play a more salient role in other cases (as in the estimation of production, cost and profit functions, or equations derived from the Solow growth models). Second, we consider the econometric tools that have been used in recent years in this area, such as panel fixed effects, GMM, spatial econometrics, VAR, and counterfactual impact evaluation methods; although we do not aim to provide a fully fledged introduction to these approaches, we seek to discuss the advantages and limitations of the various methods using actual recent studies as examples. Finally, we provide a brief discussion of the level of analysis at which studies have been conducted, from macroeconomic to regional, industry, and firm level.