Theoretical reasoning shows that spatial effects of transport cost reductions may crucially depend on market structures … paper is to compare empirically the effects of transport cost reductions due to infrastructure investments, emerging under … presented, which is calibrated for a large number of regions covering Europe. Applying this model, transport cost reductions are …

subsidising transport. Therefore transport can be said to exert a positive (pecuniary) externality. This is demonstrated by … varieties of demand are analysed, linear and negative exponential. The welfare effect of a transport subsidy is shown to be …