TEN-T corridors – Stairway to heaven or highway to hell?

Abstract

The European Union coordinates and co-finances supra-national transport infrastructure investments in the Trans-European Transport Network (TEN-T), which consists of road, rail, airport, and port infrastructure. To the best of our knowledge, we are the first to quantify the direct and indirect economic growth effects of newly created TEN-T core corridor roads in Eastern European countries. Both the panel data and the spatial analyses show that regional GDP growth at the NUTS3 level is between 0.5 and 2.0 percentage points higher, if a region has direct access to a newly built road. The analyses with a Durbin model (SDM) show that the new construction of a TEN-T core road also causes positive spillover effects on other regions that have direct access to the corridor network, as well as on regions that are not directly connected to the corridors. The results thus indicate that the TEN-T policy, which aims to alleviate transport bottlenecks, can increase cohesion between central and peripheral regions and consequently enhance regional welfare in Eastern Europe.