$1 of Highway Spending Creates $2 of Economic Activity

Economists at the Federal Reserve Bank of San Francisco studied the effects of unexpected grants to states for Federal-Aid Highways affected gross state product (GSP, or the gross domestic product (GDP) of a state).  They found that an unexpected $1 increase in federal highway grants to a state resulted in a $2 increase in GSP.  The economic effect was double the amount of the grant.  In the short term, effects on GSP were even greater.

You can read the unpublished paper here→ or read a summary here→.  Additional posts and articles related to the impact of infrastructure investment include:

American Infrastructure: An Expense We Need to Pay (Infrastructure Watch, Nov. 1, 2012)

Invest in Water Infrastructure (Infrastructure Watch, Sept. 13, 2012)

STUDY: Every $1 Of Infrastructure Spending Boosts The Economy By $2 (Kawa, L., Business Insider, Nov. 3, 2012)