PLANNING FOR A SUSTAINABLE EUROPE? - TU Berlin

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These strategic directions are consistent with an overall eco-modernist agenda.
More importantly, the official Hungarian policy explicitly voices a strong Keynesian
belief that investments in transport are the best way to stimulate development, i.e. it
clearly adheres to the (academically disputed) public capital hypothesis formulated by
Aschauer and others (also see Chapter 2) which strongly emphasizes macroeconomic
spillover-effects from transport infrastructure investments. At the same time, the policy
makes a clear reference to EU cohesion countries as models for Hungarian development,
thus implicitly also making an investment-for-cohesion argument (for details on the
“cohesion” storyline, see Chapter 6). The respective passage in the policy is worth
quoting in its entirety (KÖVIM 1996:13-14):
[In countries like] Spain, Portugal, Greece, the development of transportation, while
also anticipatory, acted as leading force, for the other sectors of the economy.
Development programs in transportation which purposefully preceded other sectors of
development, started with good reason. The aim was to create favourable conditions
for capital and resource input, particularly for those that originate abroad. For
Hungary, due to its present economic state and desirable future growth path, the lesson
of [such] countries at a mid-level of development (which also are “catching up” fast)
has more to offer than that of the most developed ones. Another favourable impact of
transportation development is through the multiplier effect, the results of which on the
economy as a whole is proven by international research. According to this, each unit
of investment made in transportation development generates, in the country or in a
particular territory, 2.5-3 times its size, in private investment. Transportation
development, in terms of its overall impact on the economy, is second only behind
telecommunications and is ahead of all other sectors. Moreover, at a macro economic
level, at times of recession, a well thought-out development program in transportation
is capable of filling the role of a counter-cyclic agent.
The “strategic directions” section also has a clearly Keynesian slant (p.21):
Investments in infrastructure act as stimulants in economic policy aimed at a program
of structural transformation, and as such, they should be initiated, supported and
funded by the state. One of the prerequisites of a renewed growth in production is an
infrastructure oriented development program.