Abstract
Using micro-level data and geographic information system (GIS) techniques, this paper analyses the impact of road infrastructure on the location of new manufacturing establishments in Spanish municipalities from 1980 to 1994, a period when most of the major road network was being developed. Poisson panel data models are estimated as they naturally allow for large sets of location choices with frequent zero outcomes and control for unobserved municipality heterogeneity. The results show that new motorways affect the spatial distribution of manufacturing establishments at the municipality level. The strength of impacts differs across sectors and space. Most benefits are concentrated near the new infrastructure, with evidence that is consistent with negative spillover effects. Firms prefer locations closer to new motorways at the cost of more distant municipalities.
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