National Policy for Regional Development: Historical Evidence from Appalachian Highways

56 Pages Posted: 14 Mar 2016 Last revised: 24 Apr 2023

See all articles by Taylor Jaworski

Taylor Jaworski

Queen's University

Carl Kitchens

Florida State University - Department of Economics

Date Written: March 2016

Abstract

How effective are policies aimed at integrating isolated regions? We answer this question in the context of a highway system in one of the poorest regions in the United States. With construction starting in 1965, the Appalachian Development Highway System ultimately consisted of over 2,500 high-grade road miles. We use a simple model of interregional trade to motivate our empirical analysis, which quantifies the relationship between market access and income. We then calibrate the model to evaluate the aggregate impact of the ADHS and compare this with alternative counterfactual proposals. We find that removing the ADHS would have reduced total income by $53.7 billion in the United States with $22 billion of the losses in Appalachian counties. Our findings highlight the potential aggregate benefits of transportation infrastructure policies, but also suggest that leakage outside of the targeted area may be substantial.

Suggested Citation

Jaworski, Taylor and Kitchens, Carl, National Policy for Regional Development: Historical Evidence from Appalachian Highways (March 2016). NBER Working Paper No. w22073, Available at SSRN: https://ssrn.com/abstract=2747193

Taylor Jaworski (Contact Author)

Queen's University ( email )

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Canada

HOME PAGE: http://sites.google.com/site/tjaworski/

Carl Kitchens

Florida State University - Department of Economics ( email )

Tallahassee, FL 30306-2180
United States

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