Network Effects of Public Transport Infrastructure: Evidence on Italian Regions
51 Pages Posted: 2 Oct 2012
Date Written: July 26, 2012
This paper contributes to the empirical literature on the magnitude of the network effects of public infrastructures, introducing a novel approach. After estimating the dynamics common to time series for the regional public capital stock, coordinated policy shocks are identified within a properly specified structural VEC model. The findings confirm previous evidence that transport infrastructures exert positive macroeconomic effects in the long run. At the same time, it is shown that this effect is attributable mostly to the impact of coordinated public policy shocks, as the literature on network externalities predicts.
Keywords: public capital, transport infrastructure, public policy coordination, network externalities, VEC model
JEL Classification: C32, E61, H54, R42, R53
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