The politico-economic determinants and productivity effects of regional transport investment in Europe

Achim Kemmerling and Andreas Stephan

No 7/2008, EIB Papers from European Investment Bank, Economics Department

Abstract: We study the determinants and productivity effects of regional transportation infrastructure investment in France, Germany, Italy, and Spain. We estimate productivity effects with regional production functions for each country controlling for the potential endogeneity of public infrastructure investment. In analyzing the determinants of public infrastructure investment two broad categories are considered: First, the normative principles such as efficiency, equity, and redistribution; and second, political factors such as electoral competition and electoral rents. The evidence shows that road infrastructure positively contributes to regional production. As to the determinants, efficiency and redistribution are consistently found to be the dominant norms while equity considerations appear to be less important. However, we find remarkable differences across countries regarding the political determinants. Which political factors matter for infrastructure investment is related to the different political systems of the various countries.

Keywords: transport infrastructure; regional growth; political economy (search for similar items in EconPapers)
JEL-codes: H54 O40 R10 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2008-07-18
New Economics Papers: this item is included in nep-eec, nep-eff and nep-pol
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Citations: View citations in EconPapers (25)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:eibpap:2008_007

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