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Open Access Publications from the University of California

The Direct and Indirect Economic Effects of Transportation Infrastructure


The notion that highways boost economic activity is a popular one. States such as Iowa and Wisconsin have promoted highway policy as an economic development tool (Dalton 1991; Forkenbrock and Plazah 1986). Benefit-cost analyses of particular highway corridors have, at times, claimed large long-term economic gains (e.g. Seskin 1990; Weisbrod and Beckwith 1992). Yet for years, economists have argued that the common perception of a link between highways and economic development is, at best, incomplete.

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