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Evaluating Economic Benefits of Newly Opened Expressways in China

In the past decade, expressways have been developed rapidly in China. It is evident that a number of opened expressways generated promoting effects on regional economic development. Most existing studies tend to assess the effects in a qualitative way. The purpose of this study was to develop quantitative methods to evaluate the economic benefits of expressway projects during the operational period. The benefits discussed include user benefits (reduced vehicle operating costs, time savings, and safety benefits), which are the direct effects of the expressway projects. The estimation of user benefits is carried out on the basis of well-defined quantitative methods. Development benefits, which are the indirect effects of the expressway projects, were also examined. Their indirect nature makes them inherently more difficult to analyze quantitatively. A comparative analysis method was developed to tackle the problem. These methodologies were applied to a case study of the Hangzhou-Ningbo Expressway in Zhejiang Province, one of the fastest-growing provinces in China in economic activity. The estimation results show that, since its opening in December 1996, the expressway has generated significant user benefits in the region. Statistical data have provided some evidence that the expressway promoted the region's economic development by improving the investment environment, promoting exchange and circulation of commodities, providing convenient transportation for tourists, and promoting development in small towns and urbanization.