Are Expressways The Key To Improving Urban Productivity?

If urban planning could be done in such a way that company offices, retail outlets, other enterprises and households are within close proximity of each other, transportation costs and commuting time would also come down. This would be an effective tool to raise urban productivity.

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When firms and households co-exist, there is a greater co-ordination among them. There would be better alignment among companies that produce raw materials and end products. Employers and employees of these companies would find each other more easily. Employees would be able to reach their offices easily and at a low-cost. Greater learning will happen within firms and even otherwise, because of greater face-to-face interaction among people.

The proposed Mumbai-Nagpur Super Expressway in Maharashtra is expected to serve this purpose. The Maharashtra government recently cleared the Rs 40,000-crore project, expected to be constructed by 2019. The state government and the Central Ministry of Highways and Surface Transport will jointly construct the super expressway, which will connect the backward regions of north Maharashtra --  Vidharba and Marathwada. It will also reduce the distance between Mumbai and Nagpur by eight hours, from the present 18 hours.

The state government's prime motive in constructing the super expressway is to improve urban connectivity, especially to the backward parts of the state. Maharashtra Chief Minister Devendra Fadnavis argues that the bullet trains in China raised productivity sevenfold and that the super expressway would serve the same purpose in Maharashtra.

How do expressways raise urban productivity?

• When transportation costs are high and commuting distances are long, firms are more likely to interact with closely located firms and hire from within the city or neighbouring cities. But, when transportation costs are lower and commuting distances short, the potential reach of firms and households will be higher. This matters because the productivity of cities has more to do with the effective size of the city than with the actual size of cities. With the super expressway, the effective size of cities and districts along it will become larger.

• The super expressway in Maharashtra is estimated to reduce the overall commuting time by about 44 per cent. Assuming that the decline is uniform along the expressway, the acceptable distance which people travel to reach offices will rise by 44 per cent. Apart from widening the labour pool for employers, this will also make a wider range of jobs accessible for employees. As many jobs, especially in Mumbai, requires a more specialised labour pool, this is very important.