I am grateful to the Institute of Transport Economics (TØI) for providing me with all resources including time, software and hardware necessary for the completion of the thesis. The influence of transport infrastructure on regional economic development and performance is one of many spatial economic phenomena that constantly attracts researchers.
The spatial nature of economy
The concept of globalization is quite useful when thinking about the role of transport infrastructure. An obvious disadvantage of the approach is that it does not allow accounting for the network properties of the transport infrastructure.
Spatial General Equilibrium approach
The model by Banister was developed to examine the role of transport infrastructure development in local economic growth and focuses on the accessibility of locations within a region. The disadvantage of these models is the incomplete representation of transport infrastructure as well as the absence of goods and public transport.
Contents of the present dissertation
2 is the network equilibrium model and therefore simply includes the effects that transport infrastructure improvements have on level e. 1996), 'The Macroeconomic Impact of Traffic Congestion: A CGE Analysis', in Bergh, J.C.J.M. eds), Recent Advances in Spatial Equilibrium Modeling, Springer-Verlag, Berlin, pp Trade and migration in a two-city model of transport investment', Annals of Regional Science, vol.
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Introduction
This requires governments or planners to understand future needs of the economy in infrastructure as well as the economic impact of possible packages of infrastructure projects. In Section 3, the welfare benefits of infrastructure projects package proposed by the Norwegian Ministry of Transport are calculated with and without taking into account the future economic growth.
Description of the SCGE model used in the analysis
Transport agents operating in each region of the model represent the commodity pools within it. Household utility functions have a CES functional form and differ between the regions of Norway.
Evaluation of welfare benefits associated with future extension of transport
- Description of the scenario of future economic performance and infrastructure
- Welfare benefit analysis
- Regional changes
Welfare benefits of the regions are related to changes in patterns of transport flows between them, as a result of infrastructure improvements. Figures 10–13: Relative changes in the total transport flows to the regions for the years 2006 and 2022, measured in percentages and in tonnes.
Prediction of future transport flows
Parameters of the production functions for sectors and means of transport used in simulations are represented in Table 1. Most of the models are implemented within the framework of Spatial Computable General Equilibrium (SCGE) modelling.
Concluding remarks
Mathematical formulation of the model
- Formulation of the simultaneous equilibrium on car and public transport networks
- Formulation of the transport ministry maximization problem
- Social welfare measure
Route selection by citizens is carried out on the following two different transport networks: car network and public transport network. A Ministry of Transport decides the best combination of transport infrastructure projects on both the car network and the public transport network according to the criteria of maximum social welfare.
Implementation of the model for Oslo case-studio
- Description of transport network
- Description of travel demands
- Calculation results
In case the level of information is low, the social security function should be simplified to include only some elements of the formulated social security measure (11). Such simplification can generally influence the choice of the best combination of investment projects, which is tested with Oslo case-studio in the next part of the paper. Each travel zone contains several network nodes which can be either origin/destination nodes and/or intersections of roads and public line stops.
Motor network used for the analysis only includes main roads of the region, which are divided into the four road classes: free-field highway, two-lane highway, two-lane city road and one-lane city road. Automotive network of the region is represented in Figure 3 in Appendix and is a simplified version of the real one. Travel demands from network users traveling during other periods of the day apart from peak time are derived as a certain proportion of peak time requests.
Since there is no congestion during other periods of the day except peak time, CSotheris is derived as the sum of travel demands in other periods of the day multiplied by the difference in travel costs, which is due to the implementation of infrastructure projects.
Concluding remarks
As demonstrated in Figure 1, the four functional forms of welfare measures used for the analysis lead to the same ordering of infrastructure packages, with the values of welfare measures being slightly different for different formulations. The network equilibrium for the travel within a city is formulated in the form of the Mixed Complementarity Problem (MCP), which allows to find simultaneous solution of both car network and public transport network equilibria. Another advantage of the formulation in the form of MCP is the possibility to use travel demand functions directly in the equilibrium formulation.
The network balance formulation in MCP form can also be easily integrated with General Spatial Balance models and land use models, as they have the same functional form. Since the four different functional forms examined in the paper resulted in the same order of infrastructure packages, it is possible to say that the most important component of social welfare is the total consumer surplus of network users. The model presented in the paper is a network equilibrium model and therefore simply includes the effects that transport infrastructure improvements have on the level of network performance ie.
1989), Pricing and Regulatory Issues in Urban Transport, Discussion Paper, The World Bank. 1995), 'The use of spatial separation in the measurement of transport accessibility', Transport Research Part A, vol. 1985), Urban Transportation Networks: Equilibrium Analysis with.
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General description of the model
Residential locations of households and locations of production activities correspond to nodes of the transport network. Car network and public transport network are used for commuting trips of households between their residence-work pairs of locations, while freight transport network is used for transporting goods between locations of the region. Economic part of the model can be classified as a regional trade model that includes transport costs.
Both commuter travel demands and freight transport demands are inputs to network performance part of the model consisting of car network equilibrium, public transport network equilibrium and freight transport network equilibrium. It should be noted that all parts of the model are solved simultaneously and formulated in the form of a single mathematical problem. Mathematical formulation of the model is based on the idea of integrating cargo network equilibrium model with SCGE model proposed by Friesz (1996).
The model further integrates general equilibrium and network equilibrium parts of the model with land use and location choice parts, which are formulated similarly to Anas and Xu (1999).
Mathematical formulation of the model
- The setting
- Representative households
- Production sectors
- Transport agents
- Transport sector
- Equilibrium at the markets
- Equilibrium at the car network
- Equilibrium at the public transport network
- Equilibrium at the freight network
The total budget of a household that chooses to live in location i and work in location j consists of the wage wj and additional income in the form of income from the total endowment of capital in region K, the total housing subsidy Ri in residential locations, and the non-competitive profit of the sectors yprjsεjs, which is evenly distributed among all households in the region. In equilibrium, no good/factor has excess demand, and if there is, the good/factor has zero price, i.e. the total transport time is the sum of the travel times on the connections that form the shortest route between the residence-work pair.
The balance in the car network is formulated as follows: car ij car ij car ni N. nm x. fc is the total flow of cars on the link, xnmj is the flow of cars on the link between nodes n and m, with destination at production location j, δnmcar∈{ }0,1 is the binary variable representing the structure of the car network, which is equal to unity when there is a car connection between nodes n and m. )cnmcar(⋅ is a function of the travel time on the link measured in hours. At each node there is a certain set of lines that passengers can take and the waiting time depends on the type of line as well as the total flow of passengers using this Line in the given link Interactions between producers and consumers of transport services are carried out in the freight transport network and the equilibrium in the market as well as the equilibrium of the network is formulated in the following mathematical form: ynm is the flow of freight transport in the link between the nodes n and m, with destination at node h, δnmfr ∈{ }0,1 is the binary variable representing the structure of the goods network.
The transportation cost function is measured in monetary units and represents the value of non-monetary transportation costs, such as travel time and the quality of transportation between locations. )εnmfr(⋅ is the profit margin function on the link also measured in monetary units and depending on the mode of transport serving it.
Simulating transport infrastructure expansion and economic growth
- Input data
- Simulation results
Concluding remarks
Equations (1)-(17) constitute a generic SCGE model of the region, which includes an implicit representation of the transport network. In the formulation of the generic SCGE model of the region (1)-(17), the following variables are unknown: wj,r,hi,qks, pjs, fjk,yksta,yjspr,ytrjk,xnmj ,cijcar,ynmj l′l ,cijpub,yknm,cjk . Production of sectors according to their locations for the base case in monetary units.
The simulation exercises performed in the paper are quite simple and their purpose is to prove the functionality of the model. The national authority can transfer money in the form of subsidies and taxes, which are part of the balancing factors in the economy. To achieve the balance of household activities, the business surplus of goods is used.
Part of the demand and inputs model includes household consumption of aggregated goods (C), input requirements (H) of aggregated goods and aggregated services, labor and physical capital, delivery of goods at producer prices to other countries (ZL), exports of goods from countries to other of the country (A) and the demand and entry of business surplus goods in amounts (G). Services produced by agents are called association services and are used in the production of goods and in the production of physical capital. This means that the supply and production part of the economy is valued according to the basic value (value 10), which means that VAT, profit and taxes/subsidies are excluded, while the demand and input part of the economy is valued at market prices. (18+19).
Columns in the SAM matrix representing outputs and inputs of the production sectors and households must also add up to zero. NAC only reports net transport of each commodity group into (ZM) and out of (ZL) the provinces.
