Since 1971, highway traffic in Taiwan has grown at a much faster rate than railway traffic. This study attempts to analyze the economic benefits of traffic investment, and to uncover the reasons for their unequal development and their mutual substitutability.
Our findings are as follows.
1) Because of the North-South Freeway, the relative price of highway traffic is higher than railway traffic. Other elements that affect railway and highway traffic are: the real GNP; the growing number of automobiles, and structural problems that have arisen in relation to the engineering of the electrified railway.
2) Infrastructural socio-economic benefits have not yet been fully developed. In recent years, however, three developments have occured:(1)the North-South Freeway has helped equalize population distribution; (2)the cement industry in eastern Taiwan has benefited from the North Link Line; (3)the electrified railroad has helped reduce pollution and has furthered energy efficiency.
3) Because of the limited land area in Taiwan, there is a need for railroads. It should be kept in mind, however, that the timing of investment and the provision of substitutable public services are both important. In other words, there is a need for some readjusting of priorities in the planning and implementation of major transportation projects.
