Spatial Analysis of Infrastructure Effects of Economic Dynamics in Russian Regions

Abstract

Sustainable development of the transport system ensures the economic space unity, integrity and national security. The study hypothesises that infrastructure as an essential factor of well-being brings economic benefits to a region and determines its socio-economic growth, with effects extending beyond the region itself. Econometric and geoinformation methods were combined to conduct a spatial analysis of the impact of the capital-labour ratio, transport and telecommunication infrastructure on gross regional product per capita and labour productivity in industry, as well as to assess direct and spillover effects. The estimates revealed a statistically significant positive spillover effect of the capital-labour ratio, railway and telecommunication development indices on economic development. At the same time, negative direct effects of railway infrastructure indices on industry indicate that, in conditions of concentration of economic activity, the increasing transport system load does not correspond to its physical growth rates under heavy wear. This conclusion is confirmed by a negative spillover effect of the capital-labour ratio on labour productivity in industry in two model specifications with a direct positive effect. Providing access to networks and information resources for enterprises and population, as well as increasing technological capabilities and the speed of interaction between economic entities cause positive externalities of telecommunications for economy. Telecommunication infrastructure is a factor of industrial production growth, however, its negative spillover effects show that regions surrounded by regions with high mobile penetration rate are experiencing a slowdown in labour productivity in industry. The obtained estimates and the spatial correlation between gross regional product per capita and labour productivity in industry should be considered in programmes for financing infrastructure projects.