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October 10, 2003

Rethinking Why We Build Roads

Roads are planned, designed, and built by engineers.  And thank goodness for that.  After hearing all the jokes about how hard it is for economists to reach a conclusion, can you imagine what a road built by one of us would look like?

But maybe the idea isn’t so far fetched.  After all, roads consume a tremendous amount of resources, both in construction and in maintenance. And they have profound impacts on economic growth. 

Too often we make that connection in reverse.  We record traffic counts and conduct engineering needs assessments to justify road expenditures.  The question, as it is usually posed, is whether or not spending on a specific road or improvement can be justified in making our journeys to our jobs shorter and safer.  When and where communities grow, our network of roads can be expected to grow to accommodate them.

But for countless parts of the country, including many parts of Indiana , the question increasingly is whether or not there will be any jobs to drive to.  The idea that the roads we build might help us create desirable jobs is one that many Indiana communities, batteredby the harsh winds of economic change, should be warming up to.

If any state’s experience teaches us that access to transportation is important, it is Indiana .  Our largest and fastest growing city, Indianapolis , sits at the nexus of four major interstate freeways.  And of the four quadrants of the state, the only one not served by a freeway – the southwest – has the lowest earnings and job growth.  And in each of the happy situations where significant private investments have been made in new manufacturing facilities, the sites chosen have had close access to the major arteries of transportation.

But not all new roads we might contemplate have the same economic impact for state residents.  Roads that bypass population centers, allowing interstate commerce to whisk through the state as quickly as possible, are of less benefit to Hoosiers than roads which connect urban centers.

Better roads bring better access, which is high octane fuel for any region’s economy.  For consumers, more access to goods and services means more variety, lower prices, and more spending power.  For companies, better access to workers increases the size and variety of the labor pool, whereas better access to vendors and suppliers of intermediate goods promotes a better fit between buyers and sellers.  Both these add to productivity and ultimately to the competitiveness of the economic base.

Imagine for just one moment that the cities of Anderson, Marion, and Muncie were connected by roads that cut the travel time between any pair down, say, to 20 minutes.  With access to all three markets, a whole host of specialized resources now become viable.  A regional airport might be one.  Specialized legal, financial, and technical resources, at least an hour’s drive away today, could move much closer.  And consumers gain better access to a wider variety of restaurants, shops and services that ultimately improve their quality of life.

If you look at commuting patterns between those three cities, such roads are probably not warranted.  But maybe it’s time we starting thinking outside of the box.  If we only build new roads in areas that are growing, are we not increasing the handicap for those facing challenges?  At a time when we’re all rethinking economic growth, that question deserves an answer.

Link to this commentary: https://commentaries.cberdata.org/350/rethinking-why-we-build-roads

Tags: transportation and logistics


About the Author

Pat Barkey none@example.com

Patrick Barkey is director of the University of Montana Bureau of Business and Economic Research. He served previously as Director of the Bureau of Business Research (now the Center for Business and Economic Research) at Ball State University, overseeing and participating in a wide variety of projects in labor market research and state and regional economic policy issues. Note: The views expressed here are solely those of the author, and do not represent those of funders, associations, any entity of Ball State University, or its governing body.

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