Evaluating Urban Transport Improvements: Cost–Benefit Analysis in the Presence of Agglomeration and Income Taxation

By Anthony J. Venables. Journal of Transport Economics and Policy, 2004

392 citations recorded by the source corpus.

There is a substantial empirical literature quantifying the positive relationship between city size and productivity. This paper studies the implications of that relationship for evaluations of urban transport improvements. A theoretical model is developed and used to derive a cost–benefit measure that includes the impact of transport improvements on city size and hence on the productivity of new and existing city workers. The size of such effects is illustrated in a simple computable equilibrium model. It is argued that these productivity effects, particularly when combined with distortionary taxation, are quantitatively important, substantially increasing the gains attributable to urban transport improvements.

Subfields: Economics and Econometrics, Transportation

View Paper: https://www.semanticscholar.org/paper/b3de8f692e1384fdf5f62ee5284961207e885c66

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Citations in the corpus

Network Effects and Total Economic Impact in Transport Appraisal (2005, methodology): “The theoretical work of Venables and Gasiorek (1999) found that if a transport project”
A meta-analysis of estimates of urban agglomeration economies (2009, background): “, VENABLES, A. J. & PATACCHINI, E. (2006) Spatial determinants of productivity: analysis for the regions of Great Britain. Regional Science and Urban Economics, 36, 727-752. ROSENTHAL, S. S. & STRANGE, W. C. (2008) The attenuation of human capital spillovers. Journal of Urban Economics, In Press, Co”
The productivity of transport infrastructure investment: A meta-analysis of empirical evidence (2013, background): “In practice, the presence of market failures (particularly, externalities) legitimates the addition of wider economic impacts from transport projects to CBA (Venables, 2007; Graham, 2007; Graham and Dender, 2011).”
Bike Sharing and the Economy, the Environment, and Health-Related Externalities (2018, background): “Cars can increase employment, productivity, and economic growth [7], but most attention has been on their negative externalities.”
Part I: Externalities and economic policies in road transport (2010, background): “Venables (2007) argues that an increase in employment resulting from a transport project is associated with two positive externalities.”
The trade-off between money and travel time: A test of the theory of reference-dependent preferences (2008, neutral): “2006), Pilegaard & Fosgerau ( 2007) and Venables ( 2007) .”
Do Public Transport Improvements Increase Agglomeration Economies? A Review of Literature and an Agenda for Research (2011, methodology): “For example, transportation might increase employment in cities, downtowns, or firm clusters both by increasing firm access to labour and by increasing links between companies (Venables, 2007).”
Can transport infrastructure change regions’ economic fortunes? Some evidence from Europe and China (2017, methodology): “Whilst this can be shown theoretically and numerically, empirical testing is more difficult, but using the framework of Venables (2007), Graham (2007) related productivity change using firm level data to changes in the economic mass (effective employment density) of a location.”
Variable returns to agglomeration and the effect of road traffic congestion (2007, background): “Venables [32] provides a theoretical example of this type of relationship showing how a reduction in travel times within a city can induce agglomeration benefits.”
Transit Service, Physical Agglomeration and Productivity in US Metropolitan Areas (2014, background): “…called “effective density”) with measures of productivity such as firm revenues (e.g., Graham, 2007; Holl, 2011), or demonstrated in mathematical models how better employment accessibility can increase employment search success and reduce vacancies (Venables, 2007; Pilegaard and Fosgerau, 2008).”
Do Cost–Benefit Analyses Influence Transport Investment Decisions? Experiences from the Swedish Transport Investment Plan 2010–21 (2012, background): “During the plan preparation process, considerable efforts were spent on developing and harmonizing CBA methodology, and subsequently carrying out CBAs for all proposed investments.”
High-speed rail networks, economic integration and regional specialisation in China and Europe (2015, background): “Recent research in the UK has identified that the potential for agglomeration economies are in fact much greater in service sectors, especially financial services (Graham, 2007; Venables, 2007; Vickerman 2008a).”
Air transport and economic growth: a review of the impact mechanism and causal relationships (2020, background): “The spatial economies literature has established links between general transport infrastructure investment and agglomeration (Graham, 2007; Venables, 2007).”