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TRANSPORT INFRASTRUCTURE AS A DRIVER OF SUSTAINABLE DEVELOPMENT OF REGIONAL ECONOMIC SYSTEMS Terenteva, Kseniia; Vagizova, Venera; Selivanova, Kseniia . Academy of Strategic Management Journal,

suppl. Special Issue ; Arden  Vol. 15,  (2016): 85-93.

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ABSTRACT  

The purpose of this research is to study the dependence of social and economic development on the regional

transport infrastructure. The authors' position is based on the fact that it has a complex impact both on the

general vector of the region' development, and on the functioning conditions of individual economic agents. This

influence is manifested through ensuring the needs of spatial economic structures in advanced development;

coordination of social and economic processes development; adaptation of global economic processes in

transport sphere to regional conditions, as well as meeting the needs of economic agents in transport and

logistics services. The study presents a methodology of integral multi-level assessment of the development level

of regional infrastructure based on the capacity of the transport system, covering various aspects of its operation

and promoting complex vision about the prospects of its further development; it serves as a basis for calculating

the indicator on the example of the Republic of Tatarstan. The methodology enables to evaluate not only the

development degree of individual indicators of the regional transport infrastructure, but also the level of its

development in general. This approach helps to identify aspects that impede the effective development of

transport infrastructure and to take measures to eliminate them. In addition, this technique enables to rank the

regions according to the development degree of various functioning aspects of their transport infrastructure. FULL TEXT  

Headnote

ABSTRACT

The purpose of this research is to study the dependence of social and economic development on the regional

transport infrastructure. The authors' position is based on the fact that it has a complex impact both on the

general vector of the region' development, and on the functioning conditions of individual economic agents. This

influence is manifested through ensuring the needs of spatial economic structures in advanced development;

coordination of social and economic processes development; adaptation of global economic processes in

transport sphere to regional conditions, as well as meeting the needs of economic agents in transport and

logistics services. The study presents a methodology of integral multi-level assessment of the development level

of regional infrastructure based on the capacity of the transport system, covering various aspects of its operation

and promoting complex vision about the prospects of its further development; it serves as a basis for calculating

the indicator on the example of the Republic of Tatarstan. The methodology enables to evaluate not only the

development degree of individual indicators of the regional transport infrastructure, but also the level of its

development in general. This approach helps to identify aspects that impede the effective development of

transport infrastructure and to take measures to eliminate them. In addition, this technique enables to rank the

regions according to the development degree of various functioning aspects of their transport infrastructure.

Key Words: Regional Transport Infrastructure, the Economy of the Region, Socio-Economic Development of the

Region, an Integrated Assessment of Transport Infrastructure, the Development Indicators of Regional Transport

Infrastructure

(ProQuest: ... denotes formulae omitted.)

INTRODUCTION

The regional transport infrastructure represents a framework of operation and long-term development, as well as it

forms the level of economic systems in the international transport and logistics services market. In the Russian

Federation transport infrastructure plays an important role due to the size of its territory (17 million sq. km) and to

the need to cover all the country with transport networks.

Intensive development of innovative processes which ensure the consolidation of the regions necessitates a

comprehensive in-depth theoretical and practical study of the development laws of regional transport

infrastructures. It should be borne in mind that in terms of economic processes integration, it is important to

consider the regional transport infrastructure in close cooperation scheme.

Rapid development of the region's economy depends largely on the development level of its transport

infrastructure which has a complex impact both on the general vector of the region's development and on the

functioning conditions of individual economic agents. In its turn, the impact of the region's economy on transport

infrastructure is manifested through a number of factors including: shaping the demand for transport services;

management and regulation of traffic flows in the region; determining the structure of financial support for

transport infrastructure development; the presence of material, technical and human resources that are necessary

for its development.

The following study is concerned with an integral assessment of the development of regional transport

infrastructure, as well as with measuring the impact of its development on socio-economic indicators of the

region.

LITERATURE REVIEW

Recognizing the significance of the regional transport infrastructure to ensure sustainable development of the

economy has caused considerable scholar interest in this problem. Russian and foreign experts considered its

various aspects. Early 1990s saw active theoretical and empirical study of infrastructure impact on economic

growth, the level and quality of life of the population. One of the first works that attracted attention to this issue,

belonged to Aschauer D. who linked the slowdown in US economic growth to a reduction of investment in

infrastructure. Researches in this area were continued by P. Evans and G. Karras, D. Canning and P. Pedroni, which

believed that to determine the optimal conditions for economic development it is necessary to analyze the link

between the availability of micro-economic infrastructure and the nature of the production process.

Subsequently, international studies revealed the relationship between the financing of infrastructure and

increasing the efficiency of firms and regions. Thus, according to studies by P. Arbués, J.F. Baños &M. Mayor, a

direct impact of transport infrastructure on the economy manifests itself through an increase in employment in the

construction sector during the development of infrastructure, reducing fuel consumption, saving time, reducing

environmental problems. While indirect effect includes productivity growth of the regional economy, optimizing the

location of companies, increasing the efficiency of the household, the change in real estate prices.

Rodrigue &Notteboom argue that the induced effect of transport infrastructure on economic development is the

result of its impact on employment and growth of surplus value. They view the induced impact as the result of the

multiplier effect where the price rise for goods and services, extension of offering range, as well as other related

consequences are the result of economic operations of firms which use efficient transport services. Furthermore,

these authors believe that the transport infrastructure provides time and cost savings.

According to Lakshmanan, improved transport infrastructure tends to reduce the average travel time, transport

costs, and, consequently, to increase transport accessibility. This in turn leads to a decrease in the marginal cost

of producers and an increase in the mobility of households and the demand for goods and services.

It should be noted that the improvement of existing or the introduction of new infrastructure can have both

positive and negative consequences. For some economic sectors growth in the availability of products and

services can lead to increased competition in the domestic market, reducing local productivity, profitability and

employment.

Transport infrastructure in itself is not a sufficient condition for economic development. At the same time, its lack

can be a deterrent to it. Low quality of transport services may have a negative impact on the competitiveness of

regions and businesses.

From this brief review of the literature it can be concluded that so far researchers were interested mostly in the

impact of infrastructure on the macro- and micro-economic development, while the problems of infrastructure

development and the interdependence of mesolevel economic systems are paid insufficient attention. In this paper

we consider the development of transport infrastructure as one of the essential factors of economic growth in the

region, which raises the need for its comprehensive assessment and analysis.

DEPENDENCE ANALYSIS OF THE ECONOMY OF THE REPUBLIC OF TATARSTAN ON THE LEVEL OF TRANSPORT

INFRASTRUCTURE DEVELOPMENT

To date, the Republic of Tatarstan is the leader of "Volga-Kama" development area, a most important area of

economic growth of the Russian Federation. The Republic of Tatarstan ranks the third in the ranking of Russian

competitive regions, calculated on the basis of AV Regions Competition Index (RCI) methodologies.

Tatarstan has a developed transport infrastructure, including road, rail, air and water transport. The advantage of

the region is a natural water endowment consisting of the Volga and Kama rivers. In addition, the republic has an

established and extensive pipeline network for oil and gas transportation. Over 2009 to 2014 the positive dynamics

of key indicators of regional transport infrastructure is observed (Fig. 1).

In order to justify the empirical dependence of the main socio-economic indicators of the Republic of Tatarstan on

the level of its transport infrastructure development, a model of correlative regression analysis was built. As

independent variables the model included factors that characterize the transport infrastructure development, such

as the number of vehicles, the length and density of railways, the intensity of passenger and freight traffic.

An indicator that best represents the contribution of a particular economic activity in the region's development is

its contribution to the region's GRP. Therefore, GRP of Tatarstan was considered as the first dependent variable.

The contribution of "Transport and Communication" industry to the gross product was taken as a second

dependent variable. The modeling resulted in coefficients of interdependence (K), whose value ranges from (-1) to

1 (Table 1).

In general, there is a high level of dependence of the selected dependent variables on the independent variables.

Dependence level of the Republic of Tatarstan's GRP is maximal on the following factors in their order of

importance: the number of lorries, number of passenger cars, the length and density of roads paved, the carriage of

passengers. One can see maximum dependence of the "Transport and communications" contribution to gross

product on the following indicators: number of lorries, number of passenger cars, haulage, length of common

carrier pipeline, and the density of roads paved. GRP of Tatarstan depends the least on factors such as length of

navigable waterways, and the number of buses. In turn, the gross product produced by activity "Transport and

Communications" is associated less with such factors as the length of railway lines and the number of buses.

Thus, it is proved that there is a strong relationship between the GRP of the Republic of Tatarstan and the

development of regional transport infrastructure.

RESEARCH METHODOLOGY

It seems appropriate to work out a methodology of integral multi-level assessment of the development level of

regional infrastructure based on the capacity of the transport system, covering various aspects of its operation

(contribution of the transport infrastructure subjects to the GRP; the demand for transportation services;

infrastructure logistics; profitability and financial stability of transport infrastructure subjects; social and

demographic conditions for the development of transport infrastructure, financing transport infrastructure) and

promoting complex vision about the prospects of its further development.

The technique enables to evaluate not only the development degree of individual indicators of the regional

transport infrastructure, but also the level of development in general. This approach helps to identify aspects that

impede the effective development of transport infrastructure and to take measures to eliminate them. In addition,

this technique enables to rank the regions according to the development degree of various functioning aspects of

their transport infrastructure.

An integral indicator of regional transport infrastructure development is calculated on the basis of groups of

indicators included in its composition: the contribution of the subjects of transport infrastructure to GRP; demand

for transport services; infrastructure logistics; profitability and financial stability of transport infrastructure

subjects; social and demographic conditions for the development of transport infrastructure; financing of

transport infrastructure (Table 2). The selection of indicators, their distribution by groups and ranking of groups of

indicators were considered within hierarchical structure: region - infrastructure - transport infrastructure - financial

infrastructure.

The group is formed of particular indices. Based on expert assessments each parameter is assigned weight, which

characterizes the degree of its impact on the group of indicators as a whole. Generalized values of groups of

indicators of regional transport infrastructure development are calculated based on the formula:

... (1)

where GIrtId - group of indicators of regional transport infrastructure development;

ai - weight of ith indicator;

xi - ith indicator.

The result of assessing the development of regional transport infrastructure is the integral index calculated by the

formula:

... (2)

where IAtId is integral assessment of the level of regional transport infrastructure development;

ßj - weight of jth group of indicators;

yj - jth group of indicators.

RESULTS

On the basis of the technique developed an integral indicator of the development level of transport infrastructure

of the Republic of Tatarstan is calculated (Table 3).

Positive dynamics of the overall level of transport infrastructure development of the Republic for the period under

review is observed. In particular, there was a significant increase in the following indices: the contribution of the of

transport infrastructure subjects to the GRP, infrastructure logistics, financing transport infrastructure.

In order to identify the most important groups of indicators that affect transport infrastructure development of the

Republic of Tatarstan, a pie-chart was built (Fig. 2).

A pie chart shows that in spite of the steady rise in financing of transport infrastructure, it has a relatively low

impact on the infrastructure development of the Republic of Tatarstan. This is an evidence of ineffectiveness of

the financial support instruments of infrastructure projects that are used in the region, which may adversely affect

the advanced development of the Republic of Tatarstan.

CONCLUSION

Regional development is influenced by many factors, one of which is the quality of transport infrastructure. High

transport accessibility of the region contributes to attracting investors, accelerating economic turnover, creating

jobs, and optimizing the siting of firms seeking to gain better access to markets.

With the increase in the rate of economic development there is a need to modernize the existing infrastructure and

to implement new infrastructure projects. Thus, there are preconditions for further development of transport

infrastructure in the territory of the Republic of Tatarstan.

Despite of this, financial support for the transport infrastructure development in the region remains limited and its

tools are ineffective. To resolve these problems, it is advisable to pursue a comprehensive policy for transport

infrastructure to attract private investors which are able to cover the lack of long-term investment. This requires

the implementation of complex innovative instruments and innovative structures, whose primary purpose will be to

increase the efficiency of financing transport infrastructure development.

References

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AuthorAffiliation

Kseniia Terenteva, Kazan Federal University

Venera Vagizova, Kazan Federal University

Kseniia Selivanova, Kazan Federal University DETAILS

Subject: Traffic congestion; Studies; Economic development; Infrastructure; Cost control;

Economic indicators; Employment; Economic growth; Sustainable development;

Efficiency; Quality

Location: Russia

Publication title: Academy of Strategic Management Journal; Arden

Volume: 15

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Supplement: Special Issue

Pages: 85-93

Number of pages: 9

Publication year: 2016

Publication date: 2016

Publisher: Jordan Whitney Enterprises, Inc

Place of publication: Arden

Country of publication: United States, Arden

Publication subject: Business And Economics--Management

ISSN: 15441458

Source type: Scholarly Journals

Language of publication: English

Document type: Feature

Document feature: Tables Graphs Illustrations References

ProQuest document ID: 1826881710

Document URL: https://search.proquest.com/docview/1826881710?accountid=28903

Copyright: Copyright Jordan Whitney Enterprises, Inc 2016

Last updated: 2016-11-16

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