INFRASTRUCTURE SERVICES AND THE PRODUCTIVITY OF PUBLIC CAPITAL: THE CASE OF STREETS AND HIGHWAYS

1997 ◽  
Vol 50 (1) ◽  
pp. 39-57
Author(s):  
MARLON G. BOARNET
Keyword(s):  
Public Capital ◽  
Infrastructure Services

Public Capital and Health

2012 ◽  
Author(s):  
Pierre-Richard Agénor
Keyword(s):  
Economic Growth ◽  
Health Outcomes ◽  
Growth Models ◽  
Large Body ◽  
Public Capital ◽  
Child Rearing ◽  
Human Welfare ◽  
Parental Time ◽  
Two Stages ◽  
Infrastructure Services

This chapter examines interactions among public capital, health, and economic growth, using both two- and three-period Allais–Samuelson Overlapping Generations models. The first model dwells on the large body of evidence that suggests that access to infrastructure may be critical to improving health outcomes. The second accounts, in addition, for the fact that there is persistence in health outcomes between childhood and adulthood, the first two stages of life. This creates the possibility that public capital may affect health in ways that are different than commonly thought: if, for instance, greater access to infrastructure services allows parents to devote more time to child rearing, and if children's health depends positively on parental time, their productivity and earnings in adulthood will also be affected. In effect, this analysis shows that time allocated to child rearing, which is often considered as unproductive in growth models, may turn out to be a critical channel through which public capital affects growth. The chapter concludes by noting that interactions between health and education, which are well documented, may serve to magnify the effect of public capital on growth and human welfare.

SHOULD THE PRIVATE SECTOR PROVIDE PUBLIC CAPITAL?

2007 ◽  
Vol 11 (3) ◽  
pp. 318-346
Author(s):  
SANTANU CHATTERJEE
Keyword(s):  
Open Economy ◽  
Public Capital ◽  
Borrowing Constraints ◽  
International Capital ◽  
Standard Assumption ◽  
Production Externalities ◽  
International Capital Markets ◽  
Private Provision ◽  
Large Production ◽  
Government Provision

The choice between private and government provision of a productive public good like infrastructure (public capital) is examined in the context of an endogenously growing open economy. The accumulation of public capital need not require government provision, in contrast to the standard assumption in the literature. Even with an efficient government, the relative costs and benefits of government and private provision depend crucially on the economy's underlying structural conditions and borrowing constraints in international capital markets. Countries with limited substitution possibilities and large production externalities may benefit from governments encouraging private provision of public capital through targeted investment subsidies. By contrast, countries with flexible substitution possibilities and relatively smaller externalities may benefit either from governments directly providing public capital or from regulation of private providers. The transitional dynamics also are shown to depend on the underlying elasticity of substitution and the size of the production externality.

Infrastructure

2017 ◽  
Author(s):  
Michael Klein
Keyword(s):  
Energy Transport ◽  
Developing Economies ◽  
Developing Nations ◽  
Sunk Costs ◽  
Natural Monopoly ◽  
Limited Government ◽  
Quality Regulation ◽  
Government Involvement ◽  
Telecommunications Services ◽  
Infrastructure Services

Infrastructure services in energy, transport, water, and telecommunications services underpin the wealth of modern nations. Yet inefficiencies abound. In developing nations hundreds of millions of people lack access to modern infrastructure services. Globally, as much as 40 percent of expenditures on infrastructure may constitute waste, equivalent to some 1 to 2 percent of global GDP. Natural monopoly features and sunk costs provide incentives for the parties to infrastructure ventures to play ransom games. Particularly in developing economies prices are often well below cost. Hence investors shy away and access remains limited. Government involvement in project choice and implementation may lead to ‘white elephants’ and mismanagement. Where head-to-head competition can be introduced, such as in modern telecommunications systems, the syndrome can be kept in check. Yet where such competition is not feasible, policymaking and inevitable price and quality regulation remain a challenge, requiring patient effort at arm’s-length from day-to-day political pressures.

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