Transportation as Catalyst for Community Economic Development


John Adams, Barbara VanDrasek

December 2007

Report no. CTS 07-07


Economics, Planning

This study presents frameworks and methods for assessing economic development impacts of well-designed transportation projects. A literature review and on-site inspections of U.S. case studies provided lessons learned, best practices, and metrics for assessing outcomes. Project site matters, whether greenfield locations or redevelopments, and whether projects are in fast-growing metro areas, stable ones, or areas losing population and resources. Prevailing land prices and regulatory environments set limits on what can be accomplished. Economic development differs from real estate development. Economic development brings resources into fuller production of valued goods and services such that overall benefits exceed overall project costs over time. It is often accompanied by real estate development; sometimes real estate development provides a catalyst for economic development. Projects can be implemented at locations from downtown to the outer suburbs; distance from the core can affect conditions for project success. A project can be implemented in elite, upper-middle class, middle class, working class, or poor areas, with choice of sector influencing prospects for success. A well-designed project improves the community's balance sheet--enhancing assets, diminishing liabilities, and increasing net benefits to the community over time. It is important to distinguish absolute change from change relative to metropolitan-wide measures.

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