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Economic Returns to Rural Infrastructure Investment

Understanding the economic returns on investing in rural infrastructure improvements is a critical element in the decision-making process for public and private investors.

On April 10-11, 2018, Farm Foundation and USDA's Economic Research Service will bring together applied researchers and rural infrastructure stakeholders to examine the impact of rural infrastructure investments on economic activity and policy-related research findings. 

“The economics profession has not done a great deal of work in the area of economic returns for rural infrastructure investments, especially in rural areas of the United States,” notes John Pender, Chief of the Rural Economy Branch of ERS.  “With this workshop, we hope to highlight the work that has been done, encourage additional work by researchers, and identify areas where knowledge is needed.”

Workshop participants are expected to include university researchers, government agency representatives, private consultants, community leaders, and experts in the economic assessment process used by international development organizations for project funding.

The intent of the workshop is for applied researchers and program stakeholders to review the best available evidence and chart a path towards producing practical research on the economic returns of investments in rural infrastructure, including highways, bridges, railways, broadband, electrical systems, and water and sewer systems.

"A current approach to rank and select rural infrastructure projects is evaluating expected returns on investment (ROI). But today, relatively little is known about the economic or social returns on infrastructure investments," says Farm Foundation President Constance Cullman.

"Some studies have looked at infrastructure relative to productivity or GDP, but very few have assessed ROI or looked specifically at rural infrastructure investments. This type of information is needed to help public and private leaders make decisions about infrastructure investments."

A  preliminary workshop agenda is available. Goals for the day-and-a-half workshop are to:

  • Take stock of current knowledge about the impacts, costs and benefits of infrastructure investments with an emphasis on rural areas of the United States;
  • Review approaches and methods to prioritize and select infrastructure investments, and discuss their past applications or potential applicability to rural infrastructure investments; and
  • Stimulate current and future research that will provide useful information to policy makers and program managers involved infrastructure investments in rural America.

Through a series of seven commissioned papers, workshop participants will examine what is known about ROI on infrastructure improvements, identify gaps in the knowledge base, and assess how this information can be used in future investment decision making by public- and private-sector leaders. Topics for the papers include the role of government and private investments and partnerships, evaluating issues for federal and state governments, the ROI on rural broadband investments, and benefit-cost analysis.

The workshop will be at the National Press Club, with sessions planned 8:30 a.m. to 5 p.m. on Tuesday, April 10, and 8:30 a.m. to noon on Wednesday, April 11. There is no fee to attend but registration is requested.









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