Abstract
There are some knowledge gaps regarding the relationship between transportation infrastructure and economic development, especially about economic impacts that occur due to implementation of infrastructure in a given region, albeit various studies have addressed the issue. This paper aims to identify variables that affect economic development in order to contribute to the development of a theoretical model that could explain the relationship between transportation infrastructure and economic development. The theoretical model is satisfactory because it begins by analyzing the actions generated by the transportation infrastructure. Moreover, the model is based on the Location Theory considering the economic development and taking into account variables such as transportation costs, gain, product value, consumption, competition between companies and lastly monopoly. Finally, an econometric procedure, Spatial Panel Auto Regressive Vector Model (PVAR), was used to evaluate the relationship between economic development and investments in transportation infrastructure.
Highlights
The body of knowledge on transportation has gaps regarding how transportation infrastructure influences economic development, especially about the economic impacts that occur due to the building of infrastructure in a given region
The objective of the econometric estimation is to explain the relationship between state expenditure on transportation and regional economic growth
The basic characteristic is the endogeneity between Transportation Expenditures (TE) and GDP Growth (GDP) in the states
Summary
The body of knowledge on transportation has gaps regarding how transportation infrastructure influences economic development, especially about the economic impacts that occur due to the building of infrastructure in a given region. Those impacts have not been measured or characterized. When transportation infrastructure makes use of the natural resources available, the cost of conveying goods is greatly reduced. From a historical perspective, Brazil has not been able to devise investment plans to provide efficient means of transportation that are coherent with the existing natural resources in each region. Lösch assumes that consumers have identical preferences, and those located on bordering areas are considered indifferent to neighboring producers when it comes to buying consumer goods (Breitbach, 1998)
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