Edouard Schaal is the recipient of a European Research Council Starting Grant for his project, “Optimal Transport Networks in Spatial Equilibrium.” In this short video, Schaal provides a brief overview of the project’s main objectives.
Every year, the world economy invests massively to improve or develop its transport infrastructure. Some of the largest ever infrastructure projects will be undertaken in the coming decades as, for instance, the multi-trillion dollar Belt and Road Initiative by the Chinese government.
By shaping the patterns of international and interregional trade, transport infrastructure plays a major role in determining the distribution of economic activity across space and fostering regional economic development.
How should these infrastructure projects be designed to maximize social welfare? In this ERC research project, my co-author Pablo Fajgelbaum and I develop and evaluate new methods to study optimal transport networks in general-equilibrium models of international trade, urban economics and economic geography, taking into account the impact of transport infrastructure on trade, migrations and economic growth.