Efficiency or Equity? Determinants of Regional Allocation of Infrastructure Investment in the Republic of Korea

Jongyearn Lee

Korean Economic Review, 2022, vol. 38, 73-108

Abstract: We used a structural model to determine which aspects of efficiency and equity criteria were advocated in allocating investment in transportation infrastructure by region in the Republic of Korea during the period of 2001–2014. The estimation by the generalized method of moments indicated that the country’s regional allocation of public investment favored equity enhancement rather than efficiency gain. Empirical findings also include evidence of the substitutionary relationship between the investments by the central and regional governments, as well as the excess capital stock of transportation infrastructure compared with the optimum. The infrastructure needs and regional financial conditions had limited effects on the past allocation of investment. Political influence was exerted with respect to electoral productivity rather than partisanship.

Keywords: Equity–Efficiency Trade-off; Transportation Infrastructure; Public Investment; Political Economy (search for similar items in EconPapers)
JEL-codes: D72 H54 H72 O18 R53 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://keapaper.kea.ne.kr/RePEc/kea/keappr/KER-20220101-38-1-03.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kea:keappr:ker-20220101-38-1-03

Access Statistics for this article

Korean Economic Review is currently edited by Kyung Hwan Baik

More articles in Korean Economic Review from Korean Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by KEA ().