Infrastructure Costs

Leah Brooks and Zachary Liscow

American Economic Journal: Applied Economics, 2023, vol. 15, issue 2, 1-30

Abstract: Despite infrastructure's importance to the US economy, evidence on its cost trajectory over time is sparse. We document real spending per new mile over the history of the Interstate Highway System. We find that spending per mile increased more than threefold from the 1960s to the 1980s. This increase persists even conditional on pre-existing observable geographic cost determinants. We then provide suggestive evidence on why. Input prices explain little of the increase. Statistically, changes in income and housing prices explain about half of the increase. We find suggestive evidence that the rise of "citizen voice" in government decision-making increased spending per mile.

JEL-codes: D72 H54 N42 N72 R31 R42 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (4)

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DOI: 10.1257/app.20200398

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