Highway grants: roads to prosperity?

Sylvain Leduc and Daniel Wilson

FRBSF Economic Letter, 2012, issue nov26

Abstract: Federal highway grants to states appear to boost economic activity in the short and medium term. The short-term effects appear to be due largely to increases in aggregate demand. Medium-term effects apparently reflect the increased productive capacity brought by improved roads. Overall, each dollar of federal highway grants received by a state raises that state?s annual economic output by at least two dollars, a relatively large multiplier.

Keywords: Transportation; Infrastructure (Economics); Roads (search for similar items in EconPapers)
Date: 2012
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