THE CENTER

ANNUAL
REPORTS
2007
2008
2009

RESEARCH THEMES

The Transportation and Economic Development Research Center has three research themes: transportation finance, transportation and land use, and entrepreneurship and innovation in transportation, as discussed below.

Transportation Finance

Securing needed funds for transportation has been a challenge throughout the history of the United States. Massive new infrastructure -- the ports and roads of the “American System” in the early 19th century, the transcontinental railroads of the 19th century, and the post-World War II interstate highway system -- all required special financing arrangements. But even more routing spending requirements have been a source of difficulty, as evidenced by the ongoing debate between donor and donee states with regard to the federal transportation budget.

In recent years surface transportation has been squeezed between rising costs and shrinking gas tax revenues, aggravated by public resistance to tax increases. In this environment several innovative approaches to transportation finance have been tried.
Toll roads, a staple of transportation finance for centuries, offer new opportunities through electronic toll collection. However, these new opportunities bring new problems: public resistance to tolls on existing roadways, the proper allocation of toll revenues, and, in the case of congestion pricing, how to balance the objectives of congestion mitigation and revenue collection when setting toll rates.

Privatization and public-private partnerships are often seen as ways to tap money and technical expertise from the business sector. But involvement of the private sector raises questions about how to insure that the public interest is fully served.

Transportation and land use

Transportation and land use are by their nature closely interrelated, and changes in one typically force changes in the other. Transportation currently faces a major challenge in the growth of the mega-city, characterized by an ever-increasing inter-penetration of population, transportation and employment patterns between neighboring cities.

Three aspects of the mega-city warrant particular attention. First is the phenomenon of the ever-increasing long commute, whereby senior professionals may travel 50-60 miles each way between a desirable residential location and a desirable employment location.
Second, “edge cities” increasingly resemble central business districts, with many of the same problems. And third, so-called “satellite” cities, edge cities far removed from central business districts, require new kinds of transportation systems.

To meet the transportation challenges posed by these changes in land use patterns, new kinds of governance arrangements are needed. Some such changes may be informal, for example, transportation associations of businesses or commuters. Some, on the other hand, may involve formal changes in jurisdictional powers, for example, creation of regional authorities.

Entrepreneurship and innovation in transportation

Entrepreneurial innovation has been a powerful engine of economic growth in the United States, particularly in the transportation sector. Henry Ford’s mass production of the automobile, the Wright Brothers, and the proliferation of independent trucking after the deregulation of the 1970s are some outstanding examples. Today there seem to be important opportunities for entrepreneurial innovation in intelligent transportation systems, the application of information systems to transportation.

Efforts to encourage entrepreneurial innovation generally involve three sets of issues: institutional, statutory, and educational. Institutional issues include structuring organizations to promote and protect entrepreneurial enclaves and establishing personnel practices that encourage appropriate risk-taking.

Statutory issues include government procurement set-asides for entrepreneurial ventures, tax policy that encourages risk-taking, and appropriately balancing intellectual property rights so as to protect the inventor’s rights while promoting rapid diffusion of innovation.

The principal educational issue is identifying and implementing strategies that encourage the development of entrepreneurial thinking.