Does Regional Infrastructure Investment Stimulate Extra Housing and Commercial Building Supply? Long-Run Evidence Across the English Regions

24 Pages Posted: 6 Sep 2011

See all articles by Michael Ball

Michael Ball

affiliation not provided to SSRN

Anupam Nanda

University of Reading - School of Real Estate & Planning, Henley Business School

Date Written: September 6, 2011

Abstract

This paper uses long-term regional construction data to investigate whether increases infrastructure investment in the English regions leads to subsequent rises in housebuilding and new commercial property, using time series modeling. Both physical (roads and harbours) and social infrastructure (education and health) impacts are investigated across nine regions in England. Significant effects for physical infrastructure are found across most regions and, also, some evidence of a social infrastructure effect. The results are not consistent across regions, which may be due to geographical differences and to network and diversionary effects. Also, results show interesting distinctions between residential and commercial real estate investment. The most important result for commercial investment suggests that the impact is more pronounced in areas of concentrated commercial investment. Overall, the results do suggest that infrastructure does have some impact but follows differential lag structures. These results provide a test of the hypothesis of the economic benefits of infrastructure investment in an approach that has not been used before.

Keywords: Regional Variation, Infrastructure Investment, Spill-over, Structural Break

JEL Classification: R11, R58, C32, H73

Suggested Citation

Ball, Michael and Nanda, Anupam, Does Regional Infrastructure Investment Stimulate Extra Housing and Commercial Building Supply? Long-Run Evidence Across the English Regions (September 6, 2011). Available at SSRN: https://ssrn.com/abstract=1923103 or http://dx.doi.org/10.2139/ssrn.1923103

Michael Ball

affiliation not provided to SSRN ( email )

Anupam Nanda (Contact Author)

University of Reading - School of Real Estate & Planning, Henley Business School ( email )

Whiteknights
Reading, Berkshire RG6 6AH
United Kingdom

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