Appendix B
Transportation Infrastructure, Freight Services Sector and Economic Growth: A Synopsis
Figure 6. General Equilibrium Effects
A flow chart of general equilibrium effects. Transport infrastructure investments flows to cheaper and better interregional and international freight service. There is a dotted line to a spatial agglomeration and network effects “oval”, plus on the other side, an innovation and technology shift “oval”. From cheaper and better freight service, arrows point to gains from trade: comparative advantage and economies of scale. Next are economic restructuring exit/entry of firms and expanded production. Finally these point to TPA (total factor productivity) and GDP growth. Both of the above-mentioned ovals also point to the expanded production/economic restructuring exit/entry of firms, and to the final box, TPA and GDP growth.
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