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Do toll-free highways foster firm formation and employment growth? Results from a quasi-natural experiment

David B. Audretsch, Dirk Dohse () and João Pereira dos Santos

No 2080, Kiel Working Papers from Kiel Institute for the World Economy (IfW)

Abstract: The paper studies the impact of a switch from free to charged highway provision on firm numbers and private sector employment in a cross-section of Portuguese municipalities. It exploits the fact that highway tolls in Portugal were unexpectedly raised in reaction to the financial crisis to establish causality. Results from a difference-in-differences analysis indicate a significantly negative effect of highway tolls on number of firms and employment in treated municipalities vis-à-vis the control group. We also find negative effects of tolls in municipalities not directly traversed by the treated highways, with larger firms and manufacturing firms being most strongly affected.

Keywords: infrastructure provision; regional economic development; quasi-natural experiment (search for similar items in EconPapers)
JEL-codes: R48 L25 R12 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eur, nep-geo, nep-sbm and nep-tid
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4) Track citations by RSS feed

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwkwp:2080

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