Large-Scale Infrastructure and Regional Economic Development: A Synthetic Control Analysis of the Øresund Fixed Link

Sammanfattning: This thesis examines the regional economic effects of the Øresund Bridge across the Denmark-Sweden border. Using macroeconomic data over the period 1980-2019, we employ the synthetic control method to estimate the effects of the bridge on three economic outcomes in the regions linked by it. Our results show that, following its opening in 2000, the fixed link had a positive effect on economic output and labor productivity in both regions, but the short-run effects were negative or null for the Danish region. For employment rate, there was a negative effect on the Swedish side and a positive effect on the Danish side, potentially reflecting enhanced labor mobility across the sound. These findings imply that the bridge had an overall positive impact on the regional economic development in the Øresund area, but that the effects differ in time and place. Thereby, they highlight the diverse effects of improved transport infrastructure as suggested by prior literature. By investigating the effects on both sides of the national border, this paper fills a gap in the previous research by providing a more comprehensive analysis of the regional economic impacts of the Øresund Bridge.