DP16734 Transportation Costs in the Age of Highways: Evidence from United States 1955-2010.
This paper constructs general road transport costs in the United States between 1955 and 2010 combining stock measures of transportation network with fuel consumption, driving speed, fuel prices, and labour costs. This results in a novel data set of 3105×3105 county-pairs for seven benchmark years. Using a county-level counterfactual analysis, we precisely quantify the reduction of the transport cost generated by Interstate Highway System. We document an inverted U-shape pattern for road transport costs, peaking in 1980, explained by initially increasing labor costs, followed by cost reductions due to trucking industry deregulation and the completion of the IHS.