New road infrastructure: the effects on firms

Henry Overman, Stephen Gibbons, Teemu Lyytikäinen and Rosa Sanchis-Guarner

No 11239, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper estimates the impact of new road infrastructure on employment and productivity using plant level longitudinal data for Britain. Exposure to transport improvements is measured through changes in accessibility, which is calculated at a detailed geographical scale from changes in minimum journey times along the road network. These changes are induced by the construction of new road link schemes. We deal with the potential endogeneity of scheme location by identifying the effects of changes in accessibility from variation across wards close to the scheme. We find substantial positive effects on employment and numbers of plants for small-scale geographical areas (electoral wards). In contrast, for firms already in the area we find negative effects on employment coupled with increases in output per worker and wages. A plausible interpretation is that new transport infrastructure attracts transport intensive firms to an area, but with some cost to employment in existing businesses.

Keywords: Productivity; Employment; Accessibility; Transport (search for similar items in EconPapers)
JEL-codes: D24 O18 R12 (search for similar items in EconPapers)
Date: 2016-04
New Economics Papers: this item is included in nep-eff, nep-geo, nep-pke, nep-reg, nep-tre and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Related works:
Journal Article: New road infrastructure: The effects on firms (2019)
Working Paper: New Road Infrastructure: The Effects on Firms (2017)
Working Paper: New road infrastructure: the effects on firms (2017)
Working Paper: New Road Infrastructure: the Effects on Firms (2012)
Working Paper: New road infrastructure: the effects on firms (2012)
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