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In particular, urban planners are concerned that an overvaluation of passenger time could give rise to excessive urban infrastructure investment which would induce low-density development of cities and urban sprawl. Transport policy measures that increase the speed and reliability of freight transport not only reduce its direct costs but have strong effects on inventory policies, logistics and even the location of firms. As recent empirical studies show, variations in time requirements for international transport, and increasingly short product and fashion cycles, have an influence on the pattern of foreign direct investment and international trade flows. Rational transport policy decision making has to take account of these indirect effects.
