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Do Winners Win More from Transport Megaprojects? Evidence from the Great Seto Bridge in Japan

Author

Listed:
  • Yoshifumi Konishi

    (Department of Economics, Keio University)

  • Akari Ono

    (Graduate School of Economics, Keio University)

Abstract
Economists are increasingly concerned with the heterogeneous impacts of transportation infrastructure investments on economic outcomes, particularly the phenomenon known as the “Straw Effect†: Core cities that were already in economic prosperity may gain more, and peripheral cities may lose, from transportation megaprojects. We empirically investigate whether such an effect manifests in the case of the Great Seto Bridges in Japan, a 70-billion-dollar project implemented in the 1980s-1990s as part of the “Building-a-New-Japan†initiative. We employ the recentered instrumental variable approach in the difference-in-differences design, exploiting the sharp decline in transport costs and its unexpected impacts on market access across cities as the exogenous sources of variation. Contrary to the Straw Effect, we find that large peripheral cities gain more than core cities from the megaproject, demonstrating that the distribution of winners and losers from the megaproject depends on how the transport cost reductions pass through in the existing network structures.

Suggested Citation

  • Yoshifumi Konishi & Akari Ono, 2024. "Do Winners Win More from Transport Megaprojects? Evidence from the Great Seto Bridge in Japan," Keio-IES Discussion Paper Series 2024-018, Institute for Economics Studies, Keio University.
    • Handle: RePEc:keo:dpaper:2024-018
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    File URL: https://ies.keio.ac.jp/upload/DP2024-018_EN.pdf
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    More about this item

    Keywords

    Market Access; Transportation Investment; Core-Periphery Model; Economic Geography; Quantitative Spatial Model; Treatment Effect under Spatial Network;
    All these keywords.

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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