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State highway capital expenditure and the economic cycle

Research output: Journal Publications and ReviewsRGC 21 - Publication in refereed journalpeer-review

Abstract

The conventional wisdom on state and local budgeting suggests that policy makers are quick to cut capital spending during fiscal stress and that budgetary politics may create a bias against long-term capital investment. This study analyzes changes in highway capital spending of U.S. state governments between 1988 and 2000, and shows a contrary result. During economic recessions, states on average slow their capital spending growth, but do not impose significant cuts, and, during economic booms, they are quick to capitalize on the opportunity and raise capital spending significantly. The article draws from the results of the study to discuss implications for the current fiscal crisis and for future research on capital budgeting.
Original languageEnglish
Pages (from-to)101-116
JournalInternational Journal of Public Administration
Volume31
Issue number2
DOIs
Publication statusPublished - Jan 2008
Externally publishedYes

Bibliographical note

Publication details (e.g. title, author(s), publication statuses and dates) are captured on an “AS IS” and “AS AVAILABLE” basis at the time of record harvesting from the data source. Suggestions for further amendments or supplementary information can be sent to [email protected].

Research Keywords

  • Economic cycle
  • Highway expenditure
  • State budgeting

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