Journal of Transport and Land Use

Effects of toll road construction on local road projects in Indonesia

I.G. Ayu Andani

Center for Transport Studies, University of Twente, the Netherlands;School of Architecture, Planning and Policy Development, Institut Teknologi Bandung, Indonesia

http://orcid.org/0000-0002-4243-9359

Lissy La Paix Puello

University of Twente, the Netherlands

http://orcid.org/0000-0001-8377-4471

Karst Geurs

University of Twente, the Netherlands

http://orcid.org/0000-0003-0918-8903

DOI: https://doi.org/10.5198/jtlu.2019.1258

Keywords: toll road, local roads, decentralisation, direct effect, indirect effect

---

Abstract

This study investigates the extent to which the construction of national toll roads in the Jakarta–Bandung region in Indonesia induces the development of local road projects nearby. In doing so, we disentangle the direct and indirect supply effects by considering the year of construction and urban development, respectively. We formulate four binary logit models to examine the direct and indirect relationships between toll road construction and local road projects. The dataset comprises 94 road projects planned or carried out between 2004 and 2016. We conduct interviews with local officials in the Jakarta–Bandung area to obtain data on the projects’ decision-making processes. Our modelling results show that existing and planned toll roads induce the development of local road projects both directly and indirectly. Local road projects tend to be developed in anticipation of the opening of a toll road. The changes in residential area and population around the toll roads also induce local road construction.

---

Author Biographies

I.G. Ayu Andani, Center for Transport Studies, University of Twente, the Netherlands;School of Architecture, Planning and Policy Development, Institut Teknologi Bandung, Indonesia

PhD Researcher at Center for Transport Studies in the University of Twente and on-leave Lecturer in Institut Teknologi Bandung.

Lissy La Paix Puello, University of Twente, the Netherlands

Assistant professor at Center for Transport Studies, University of Twente

Karst Geurs, University of Twente, the Netherlands

Professor at Center for Transport Studies, University of Twente

---

References

Aljoufie, M., Zuidgeest, M., Brussel, M., & van Maarseveen, M. (2013). Spatial–temporal analysis of urban growth and transportation in Jeddah City, Saudi Arabia. Cities, 31, 57–68. doi:http://dx.doi.org/10.1016/j.cities.2012.04.008

Avin, U., Cervero, R., Moore, T., & Dorney, C. (2007). Forecasting indirect land-use effects of transportation projects. Washington, DC: American Association of State Highway and Transportation Officials. Retrieved from http://onlinepubs.trb.org/onlinepubs/archive/NotesDocs/25-25(22)_FR.pdf.

Banister, D., & Berechman, Y. (2001). Transport investment and the promotion of economic growth. Journal of Transport Geography, 9(3), 209–218.

Baum-Snow, N. (2007). Did highways cause suburbanization? The Quarterly Journal of Economics, 122(2), 775–805.

Ben-Akiva, M. E., & Lerman, S. R. (1985). Discrete choice analysis: Theory and application to travel demand (Vol. 9). Cambridge, MA: MIT press.

Bierlaire, M. (2017). Calculating indicators with Biogeme. Paper presented at the Choice Modelling in Environmental Research: Challenges, Applications and New Trends. September 25, University of Bern, Switzerland.

Boarnet, M. G. (1996). The direct and indirect economic effects of transportation infrastructure. Berkeley, CA: University of California Berkeley University of California Transportation Center. Retrieved from https://escholarship.org/uc/item/1506r290

Cervero, R., & Hansen, M. (2002). Induced travel demand and induced road investment: A simultaneous equation analysis. Journal of Transport Economics and Policy (JTEP), 36(3), 469–490.

Cervero, R., & Murakami, J. (2010). Effects of built environments on vehicle miles traveled: Evidence from 370 US urbanized areas. Environment and Planning A, 42(2), 400–418. doi:10.1068/a4236

Chi, G. (2010). The impacts of highway expansion on population change: An integrated spatial approach. Rural Sociology, 75(1), 58–89. doi:10.1111/j.1549-0831.2009.00003.x

Downs, A. (2000). Stuck in traffic: Coping with peak-hour traffic congestion. Washington, DC: Brookings Institution Press.

Duranton, G., & Turner, M. A. (2011). The fundamental law of road congestion: Evidence from US cities. The American Economic Review, 101(6), 2616–2652.

Eliasson, J., Börjesson, M., Odeck, J., & Welde, M. (2015). Does benefit and cost efficiency influence transport investment decisions? Journal of Transport Economics and Policy, 49(3), 377–396.

Eliasson, J., & Lundberg, M. (2012). Do cost–benefit analyses influence transport investment decisions? Experiences from the Swedish transport investment plan 2010–21. Transport Reviews, 32(1), 29–48.

Forslund, U. M., & Johansson, B. (1995). Assessing road investments: Accessibility changes, cost benefit and production effects. The Annals of Regional Science, 29(2), 155–174.

Fridstrom, L. (1999). Econometric models of road use, accidents, and road investment decisions. Volume II. Oslo: Institute of Transport Economics.

Fridstrom, L., & Elvik, R. (1997). The barely revealed preference behind road investment priorities. Public Choice, 92(1–2), 145–168.

Ghani, E., Goswami, A. G., & Kerr, W. R. (2012). Highway to success: The impact of the Golden Quadrilateral project for the location and performance of Indian manufacturing. Retrieved from https://dash.harvard.edu/bitstream/handle/1/13135314/ghani,goswami,kerr_highway-to-success.pdf?sequence=1

Goode, F. M., & Hastings, S. E. (1989). The effect of transportation service on the location of manufacturing plants in nonmetropolitan and small metropolitan communities. In W. R. Gillis (Ed.), Profitability and mobility in rural America: Successful approaches to tackling rural transportation problems. University Park, PA: Pennsylvania State University Press.

Hansen, M., & Huang, Y. (1997). Road supply and traffic in California urban areas. Transportation Research Part A: Policy and Practice, 31(3), 205–218. doi:https://doi.org/10.1016/S0965-8564(96)00019-5

Ji, W., Wang, Y., Zhuang, D., Song, D., Shen, X., Wang, W., & Li, G. (2014). Spatial and temporal distribution of expressway and its relationships to land cover and population: A case study of Beijing, China. Transportation Research Part D: Transport and Environment, 32, 86–96. doi:http://dx.doi.org/10.1016/j.trd.2014.07.010

Levinson, D., & Karamalaputi, R. (2003). Induced supply: A model of highway network expansion at the microscopic level. Journal of Transport Economics and Policy (JTEP), 37(3), 297–318.

Mouter, N. (2017). Dutch politicians’ use of cost–benefit analysis. Transportation, 44(5), 1127–1145. doi:10.1007/s11116-016-9697-3

Nellthorp, J., & Mackie, P. (2000). The UK roads review—a hedonic model of decision making. Transport Policy, 7(2), 127–138.

Nilsson, J.-E. (1991). Investment decisions in a public bureaucracy: A case study of Swedish road planning practices. Journal of Transport Economics and Policy, 56, 163–175.

Nyborg, K. (1998). Some Norwegian politicians’ use of cost-benefit analysis. Public Choice, 95(3–4), 381–401.

Odeck, J. (1996). Ranking of regional road investment in Norway. Transportation, 23(2), 123–140.

Odeck, J. (2010). What determines decision‐makers’ preferences for road investments? Evidence from the Norwegian road sector. Transport Reviews, 30(4), 473–494. doi:10.1080/01441640903138640

Rephann, T., & Isserman, A. (1994). New highways as economic development tools: An evaluation using quasi-experimental matching methods. Regional Science and Urban Economics, 24(6), 723–751. doi:http://dx.doi.org/10.1016/0166-0462(94)90009-4

Rinaldi, S. M., Peerenboom, J. P., & Kelly, T. K. (2001). Identifying, understanding, and analyzing critical infrastructure interdependencies. IEEE Control Systems, 21(6), 11–25.

Train, K. E. (2009). Discrete choice methods with simulation: Cambridge, UK: Cambridge University Press.

WJP-MDM. (2013). Konsep awal Pengembangan Metropolitan Bandung Raya. Retrieved from http://metropolitan.jabarprov.go.id/sources/download/paper/6f79c-06-konsep-awal-pengembangan-metropolitan-bandung-raya_juni-2013_a22.pdf