State Capacity for Building Infrastructure

Zachary Liscow

Working Papers from The Aspen Institute Economic Strategy Group

Abstract: Recent legislation has brought the goal of getting the most out of public infrastructure funds to the fore. The high cost of building major infrastructure in the US is a longstanding challenge, but it is not inevitable. This paper highlights three elements of state capacity that underlie the high costs and slow timelines the US faces. The first challenge is personnel: government pay has not kept up with private pay, and the public workforce has not kept up with the workload; public-sector work is instead increasingly privatized, raising costs. The second challenge is procedure: government workers operate under onerous procedures and in a litigation environment that makes construction slow and expensive. The third challenge is a lack of adequate tools, including data systems and long-term planning abilities. This paper highlights reforms to deliver better, more cost-effective public infrastructure. Regarding personnel, hiring more government planners and managers, paying them in line with the private sector, and insourcing more planning could help. Regarding procedure, reducing permitting and procurement burdens, promoting faster but more representative public participation, improving coordination, and centralizing certain decisions at the federal level could help. Regarding tools, improving internal data systems and data availability would create a better evidence base, and better long-term planning could improve decision making quality.

Keywords: public economics; institutional economics; infrastructure (search for similar items in EconPapers)
Date: 2024-12-01
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