Time Sequence and Nature of Impacts between Transport and Economic Development

There are five potential relationships between transport and economic development:

• The first (1) is when there is a weak relationship which is often difficult to establish (concomitant / permissive). Although it is noted that transportation support economic and social activities, no specific causality can be expressed. This is particularly the case for infrastructures that have been implemented a while ago and have become embedded to the regional economy. Their lead role can no longer be asserted but in does not mean that transportation is not important as it is still a fundamental component supporting the economy.
• The second (2) concerns a positive / lead impacts of transportation where investments and the presence of infrastructures convey economic growth for a region, namely the expansion of production and consumption. This process commonly takes place when infrastructures are built to access resources or new markets, which then trigger a wave of investments.
• The third (3) is when there is a lag in the development of transport systems relative to economic development, implying that the development of the transport system follows economic development. A good example would be fast paced development, as seen in Pacific Asia (notably China), where transport infrastructures have difficulties keeping up with the substantial growth of the traffic generated by new globally linked manufacturing functions.
• The fourth (4) relationship commonly involves an attempt at infrastructure investment in hope to trigger development and/or to attract traffic. Many negative outcomes of such strategies have been observed. For instance substantial infrastructures can be built at great cost, while they fail to attract new traffic, leaving the community with a substantial debt that cannot be recovered and that will drain regional wealth for a while. On the other hand, transportation could attract traffic, but the new accessibility benefits a priori external economies with improved access to the regional market. Local resources, either physical of human (emigration), can also be "drained" away.
• The fifth (5) represents the worst case scenario. In addition to the negative consequences of transportation investments on the economy, these investments are occurring after the downward spiral began and may even accelerate the process.