Roads or other economy?

12 €

Infrastructure spending is often thought of as a great way to stimulate the economy, regardless of the outcome of individual projects.

Infrastructure spending can boost broad macroeconomic aggregates such as GDP or total employment. However, because infrastructure projects take a long time to start and finish, they can’t always provide the right stimulus to help the economy through tough times. Infrastructure spending is most effective if it fills a need that already exists, is implemented at the right time, and puts money in the hands of industries and workers who are affected by a downturn or economic expansion.

Infrastructure spending creates jobs involved in planning and implementing various projects. This includes both intellectual labor and manual labor. Infrastructure projects often take many months to several years to complete, meaning that jobs will remain unfilled. These workers then spend their earnings locally and help stimulate the economy. Moreover, once the projects are completed, citizens can use transport and public services more efficiently to improve productivity and well-being.

We address these findings by explaining that the distribution of infrastructure spending according to the economic value added of the country’s areas has been linked to political incentives and has often been influenced by political and electoral considerations.

The policy document is organized as follows:

After the introduction, statistical indicators of road inventory and budget funds for the period 2001 – 2024 are presented.

In the second section, we provide an approach to the economic impact of roads.

In the third point, we discuss through arguments whether only infrastructure or the rest of the economy should be the focus of policies and budget redistribution.

In closing, some comments are presented regarding the possibility of understanding how much an approach from what we have today is good for the health of the economy, but also for individuals and the future, and what some options could be that could be elaborated differently from the current approach.

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Description

Roads or Another Economy? is a study supported by ALTAX, as a policy and position paper. This paper is presented for the purpose of discussion and debate based on arguments and professional comments from all interested groups and actors.

Roads are perhaps one of the most important infrastructure assets as they facilitate, influence and can act as an indicator of sustainable economic development.

They increase access to public services such as healthcare and education, as well as increasing flexibility and choice. The better the access, the higher the benefits that can affect future economic development and social improvements, especially in areas with a predominance of public services.

Macroeconomic theories on economic growth and development point to the importance of public infrastructure in the process of economic development.

Any opinions expressed here are those of the author(s) and not of ALTAX. The analyses disseminated by ALTAX may include views on policy, but ALTAX itself does not hold institutional policy positions.

This work is published under the responsibility of ALTAX. The opinions expressed and arguments used herein do not necessarily reflect the views of the ALTAX management.

If data (text and any content) from this publication are distributed or reproduced, they must be accurately presented and attributed to the original source cited in this publication. This requirement for the quality of the source must accompany any use of data and comments, whether obtained directly from ALTAX or from another user.

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