Abstract
Investment in transportation infrastructure contributes to economic development directly by lowering transportation costs and facilitating trade. Services provided by transport infrastructure are fundamental to economic activities due to enhanced mobility of goods and services. The aim of this paper is to analyze the relationship between the transportation infrastructure and economic growth in Turkey for 1970-2006 period. Empirical analysis from cointegration tests with and without structural break show that the long run effects of real income, highway length, railway length and labor force on real income vary within tests with respect to sign and significance. However, the relationship of the share of transportation in fixed capital investments and real income is positive and significant for all tests. This shows that private and public policies toward transportation infrastructure should target investments and improvements in the quality of transportation, not quantity.
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