This paper assesses the economic justification for the selection of priority projects defined under the auspices of the Trans-European transport network. Three different transport models are used to analyse the costs and benefits associated with the current list of 30 priority projects. Most of these projects fail the cost-benefit test and few of the economically justifiable projects would need European subsidies to ensure their viability. Two remedies are proposed to minimise the inefficiencies surrounding project selection. The first remedy would oblige each member state or group of states to perform a cost-benefit analysis, followed by peer review and ensure that the results were published publicly prior to the ranking of federally funded priority projects. The second remedy would require federal funding to be made available only for projects with important spillovers to other countries in order to avoid pork barrel political behaviour.
Bibliographical noteFunding Information:
8 The EC financed the research project via the VIth Framework Program of DG-TREN.
Acknowledgement The authors acknowledge the support of the EC—VI Framework Program of DG-TREN via the FUNDING consortium. Only the authors are responsible for the views that are expressed in this paper. F. Dunkerley acknowledges the support of the FWO-Flanders project on political economy and Adler acknowledges the support of the Recanati Foundation. We thank the referees and H. Minken for their helpful comments.
- Cost benefit analysis
- Transport infrastructure