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The Relationship between Investments in U.S. Transportation Infrastructure and Competitiveness of U.S. Exports

Description:

Transportation infrastructure is the backbone of any nation’s internal economy. The ability to move people and cargo quickly, safely, and efficiently to different parts of the country enhances the ability of businesses to compete regionally, nationally, and internationally. Moving people and cargo to, and subsequently through, a nation’s ports of international departure demands a modern transportation infrastructure that provides both safe transit and maximum efficiency to reduce transportation costs. The United States has a comparatively large number of ports of international entry and exit that should be an asset to export growth, but efficiency and quality of transportation to and through those ports is not commensurate with the nation’s standing as the world’s second-largest export economy. The United States also has one of the largest inland water and inland port systems in the world which provides a substantial cost advantage to US agricultural, commodity, chemical and manufacturing exports. Historically, inland waterways have handled 6-8% of total freight shipments by weight and are a critical multi-modal component of the US Freight transportation system. Only one U.S. airport handled enough international cargo in 2016 to make a global top 10 list. There is currently only a single other proposal to build a freight only international air cargo airport. Seaports hardly fared better, with the first U.S. seaport appearing at number 18 on the 2016 list of top 40 container ports by volume and at number 13 on the 2016 list of top 100 ports by tonnage. As other service-based economies still consistently place higher than the U.S. in these lists, not to mention comparisons of rail, road, and bridge systems, the economic interests of the U.S. would be well served by an analysis of the potential impacts of infrastructure investment.

Objective:

Research the commonalities in transportation infrastructure of top producing export economies worldwide and identify what infrastructure investments the U.S. can make to ensure it remains a leader in exports, including a review of development funding strategies. Research could include identifying where recent international and U.S. infrastructure investments have been made, such as construction of intermodal facilities, bridges, airport facilities, etc., and what effect such investments have had on volume of exports through that location/region. Also of interest is analysis of how best to expand the existing multi-modal capacity of freight transportation networks.

Examples of potentially useful metrics include:

  • Exports (value) per dollar of infrastructure spend* Exports (value) two years pre- and post- major infrastructure project (must be rationally related to spend; control for non-infrastructure impacts)
  • Return on investment for capacity-building projects (i.e., runway expansion, dredging & widening, container storage expansion) vs. efficiency/streamlining projects (i.e., automation of container loading/unloading, automated cargo processing facilities)
Benefits:

The ability to identify what has worked internationally and to determine the return on investment for various transportation infrastructure projects may help inform development priorities for Federal, State, and local governments as well as private industry.

Related Research:

Several reports and studies have been conducted on various aspects of transportation infrastructure investment, but for the most part, they are of narrower focus. Researchers could use some of this information as reference or to aid in finding direction. Examples of relevant information include other Transportation Research Board publications like:

Other such publications related to the proposed research subject are widely available, but few if any take a comparative approach to the impact of infrastructure improvements on overall export competitiveness.

Tasks:

Potential avenues of research include:

  • Evaluate top airports and seaports globally, as rated by both cargo volume and quality rankings, and identify commonalities in development/re-investment spending; compare these funding levels with U.S. investments in airport and seaport development.* Evaluate the frequency of major redevelopment and investment projects at top airports and seaports globally, as rated by both cargo volume and quality rankings, development funding as a percentage of gross income of the facility, and changes in export volume in years following completion of development projects; compare these findings with the related information for U.S. facilities.* Identify the transportation modes that will most directly impact export capacity by evaluating global export trends in relation to transportation (e.g., proportional increases in air cargo vs. shipping cargo, shipping volume per freighter, intermodal rail facilities, direct highway access, etc.).
  • Determine what kinds of U.S. infrastructure projects are likely to provide the greatest export return on investment (export increase per dollar of infrastructure investment).
  • Determine what kinds of products and industries could be exported by improved infrastructure projects.
  • Identify the locations around the country that could see the greatest export impacts from major transportation infrastructure investments.
  • Identify funding sources and funding strategies for major infrastructure projects around the world and analyze which strategies could be employed in the U.S. market; identify instances where those strategies have been employed in the U.S. and review their success.
Relevance:

The topic has ongoing relevance, especially given the focus on international trade with Canada and Mexico via the new USMCA agreement.

Sponsoring Committee:AT020, International Trade and Transportation
RNS Developer:Daniel Hackett
Source Info:This would make an excellent research paper for the Standing Committee on International Trade and Transportation
Date Posted:01/11/2019
Date Modified:01/24/2019
Index Terms:Exports, International trade, Competition, Ports of entry, Infrastructure,
Cosponsoring Committees: 
Subjects    
Marine Transportation
Freight Transportation
Planning and Forecasting
Economics
Policy

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