The effects of improved transportation links on Dutch cities

Cities are prime locations of economic activities. They become increasingly important to policy makers and researchers. Different types of economic integration affect growth of cities by changing their market access. In Brakman et al. (2012) we analyzed the effects of integration through abolition of national border barriers and through international town twinning (TT) on cities growth. In this paper, we look at the third type of integration through abolition of transportation barriers and its effects on cities.

In this paper, we analyze the long-run effects of improved transportation on the Dutch municipalities. First, we test for the theoretical effects of changing transportation costs and congestions factors in the case of multiple regions, after which we simulate the improved transportation links. Improved transportation facilities generally benefits the municipalities that are located reasonably close to the projects locations, but not necessarily the locations of the projects themselves, i.e., the gains measured by higher agglomeration occur neither too close to nor too far from the project locations.