A Study of Direct and Indirect Econimic Effects by Regional Road Investments in Korea

Abstract

The purpose of this study is researching the direct and indirect effects by road investments using panel data. In this study, the direct effect means the economic impact within the same jurisdiction that contains highways or streets, and the indirect effect means the economic impact outside of the jurisdiction that contains highways or streets. For the analysis, vector autoregressive model of the time series analysis is used. From the results, the manufacturing industry has the biggest direct effect by road investments. And the construction industry has the biggest indirect effect by road investments. Finance, insurance and service industry has the least both direct and indirect effects. In addition, the direct effect has ranges between 0.107∼0.548, the indirect effect has ranges between – 0.447∼ – 0.134.