The spatial decay of agglomeration economies: estimates for use in transport appraisal

Transport investments can induce positive productivity benefits via agglomeration economies by increasing the scale and efficiency of spatial economic interactions. In assessing the ‘agglomeration benefits’ of transport investments we need to understand the spatial scale over which these externalities are distributed. This report is concerned with the effect of urban agglomeration on productivity and with how agglomeration externalities diminish with distance from source.