Research

Project Number:
05-04

Research Project:
Ports and Highways Infrastructure Investment and Inter-state Spatial Spillovers

P.I. Name & Address:
Kristen Monaco
California State University, Long Beach
Department of Economics

1250 Bellflower Boulevard
Long Beach, CA 90840
Tel:(562) 985-5076
Fax:(562) 985-5804
Email:kmonaco@csulb.edu

Project Objective:
U.S. ports serve a vital role in the nations' supply chain and international trade.While the areas surrounding these ports bear the external costs of port expansion (congestion, air pollution, noise pollution) the benefits from port activity are felt by other regions that do not bear these costs. The purpose of this study is to assess the role that transportation infrastructure plays in production and employment in the manufacturing industry.

Using state-level data from the 48 contiguous states, we will model manufacturing production and cost, incorporating state and local investment in port and highway infrastructure as variables in the model. We incorporate spatial autocorrelation, which will allow us to quantify the extent to which a state benefits from port and highway investment in neighboring states.

We will also be able to quantify the complementarity between port and highway infrastructure. This will allow us to test whether gains in productivity can be derived from increasing one aspect of transportation infrastructure (eg. ports) while holding investment in another (eg. highways) constant.

While this model utilizes state-level data on manufacturing, it can be extended along a few lines.First, our model could be applied to other industries that are dependent on port activity, such as wholesale or retail trade.Second, the model could be further disaggregated to examine benefits to employment and output at a county level. This is especially relevant for California, where many inland counties benefit from activities in Los Angeles county.

Task Descriptions:
1. Compile data sets (3 months)
2. Estimate model and provide initial interpretation of results (3 months)
3. Present initial finds and work on policy prescription section of paper (3 months)
4. Provide final report (1 months)

Milestones, Dates:
February 1, 2005 - January 31, 2006

Total Budget:
$68,414

Student Involvement:
One Student, 600 hours @ $15.00/hr

Relationship to Other Research Projects:
Related to 99-10, 03-19; part of goods movement and international trade focus area

Technology Transfer Activities:
Project report to be posted on the website; results presented to local agencies

Potential Benefits of the Project:
Quantify spillover benefits to other states of California transportation investments

TRB Keywords:
Goods movement; economic spillovers

Primary Subject:
4b.4 Transportation planning, economic and institutional issues

Goals:
4c.3 Economic growth and trade

Enabling Research:
4c.11 Tools for modeling and design

Modal Orientation:
Highway, maritime