Motorization and the Provision of Roads in Countries and Cities

Abstract

Using panel data from 50 countries and 35 urban areas (covering a wide range of country incomes), the authors summarize trends in motorization and the provision of roads, and they examine the ratio of motor vehicles to roads in a production function framework at both national and urban levels. They find regularities very strong across countries and urban areas and over time. Among their sometimes surprising findings: (1) Economic development increases demand for transport, reliance on cars and trucks, and road provision. (2) Motorization expands at the same rate as per capita income, but the auto fleet expands more rapidly, and commercial vehicles less rapidly, than income. At early stages of motorization, commercial vehicles comprise a large share of the motor vehicle fleet. Passenger transport by automobile becomes more prominent as income grows. Both country and urban data show evidence of similar saturation levels for car and total motor vehicle ownership. (3) The presence of railways at the national level reduces commercial vehicle ownership but not car ownership, suggesting that rail is competitive for freight but not for passenger travel as incomes grow. (4) Nationally, road networks expand more slowly than incomes, but paved road networks expand at the same time as incomes. Road provision appears to be quite responsive to demand nationally. (5) For specific urban areas, per capita road length is positively associated with national income level but changes little over time, showing that history or urban endowments matter. The annexation of surrounding developed area appears to play a big role in expanding urban road length. Urban areas average roughly 15 times more road length per unit area, and seven times more vehicles per kilometer of road, than countries -and a saturation level exists for urban road length per unit of area. (6) Vehicles per kilometer of road are positively associated with income, with (proxies for) land prices, and with low gasoline prices.