Modeling and simulating the economic and demographic impact of transport infrastructure investment

Investment in transportation infrastructure has been widely utilized as an instrument for inducing economic growth in a country or region. Such investment usually leads to job creation and an increase in per capita income that, in turn, encourages an increase in population through migration. The increased spending of these newly migrated populations leads to secondary job creation and further economic development. However, this increased economic activity corresponds with increased utilization of the transport infrastructure resulting in high levels of congestion. This congestion may negatively impact the attractiveness of the region for further new investment since the level of congestion in a transportation network is known to affect the productivity of the workforce. Thus, congestion has a direct impact on the region's GRP (Gross Regional Product). Often, calls are made to alleviate this congestion through added investment in the transport infrastructure. This, again, further spurs economic activity, migration, and congestion. The present study employs a system dynamics approach for modeling the cyclic relationships observed between the economic impact of transportation infrastructure and regional development. Our approach uses a common platform wherein the interconnected factors of demography, transportation infrastructure, and economic activity are jointly modeled and simulated. This model aspires to be utilized as a decision support and consensus building tool in the process of better understanding the impact of investment in transport infrastructure. © 2011 Simulation Councils, Inc.