This dissertation explores three areas related to highway investment and answers three key questions: What effect does local and national political representation have on additions to highway capacity? What is the relationship between highway capacity and productivity at the county level? Does the highway regulatory process restrict the supply of land for housing enough to influence the elasticity of housing supply? There are currently few examples of empirical studies of the political economy of highway expenditure and even fewer of the specific relation between highway investment and regional productivity. The analysis focuses on highway capacity as a measure of capital investment - exploring the link between economic growth and the result of infrastructure investment, rather than a dollar amount of expenditures. The models use county-level data to measure the local effect of capacity on economic activity. This work also provides a much needed link between transportation regulation and the housing market. Although transportation is a key part of the Standard Urban Model (SUM) empirical work has largely failed to provide significant results on the relation between transportation and urban development. The current literature on the price elasticity of housing supply literature is focused on the roles of land use zoning and geographic barriers to development and ignores the possible effects of transportation planning and investment on the supply of buildable urban land.
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