The Role of Transport in Catching Up of New Member States

Abstract

New members joined the European Union in 2004 in the  hope of catching up. One of the fields where new members  are lagging is transport. After joining the EU, investments in transport infrastructure and transport equipment have  risen remarkably, mainly due to EU funding. At the same  time, GDP growth of new members has exceeded the EU  average. This paper examines the connection between  investment in transport and economic growth in the  European Union focusing on the group of its Central and  Eastern European new members. Direct effects of  investments, indirect effects on productivity and welfare, as  well as crowding in effects on further investments are  considered. This paper aims to identify issues for further  research and to give an outlook for the decade of the  2020s.