LINKAGES BETWEEN TRANSPORT strongINFRASTRUCTUREstrong AND ECONOMIC GROWTH.pdfVIP

Transport infrastructure and economic growth O’Fallon LINKAGES BETWEEN TRANSPORT INFRASTRUCTURE AND ECONOMIC GROWTH Dr Carolyn O’Fallon Director, Pinnacle Research ABSTRACT The purpose of this paper is to highlight what is understood (and what is not understood) about the relationship between transport infrastructure, and the services it provides, and economic growth in developed economies. In concluding that transport investment on its own will not guarantee economic growth, the paper examines such things as: • The underlying conditions that, in conjunction with transport investment, could facilitate economic growth • Impact on regional versus national economic growth • The differential impacts on industry of transport infrastructure investment • The potential for transport infrastructure investment as a transforming economic activity • the possible role of political influences on infrastructure provision. The implications of this relationship for transport infrastructure management in New Zealand are briefly examined. The paper provides a reasonably “high level” view of the subject, and does not attempt to fully explain the theoretical underpinnings of the debate. This paper does not attempt to address the issue of “decoupling” economic growth and growth in transport consumption, as this has been the focus of a separate project elsewhere. Rather, the focus is on transport as an input factor in economic production. Keywords: transport infrastructure, economic growth, investment 1. INTRODUCTION