The Demand for Municipal Infrastructure Projects

Laurie J. Bates and Rexford Santerre ()

Public Finance Review, 2015, vol. 43, issue 5, 586-605

Abstract: Many studies have investigated the determinants of current local public expenditures whereas only a few have studied the factors explaining the capital decision-making process at the local government level. This study uses a panel data set of Connecticut town and cities over the 2000 to 2010 period to estimate the local public demand for various types of capital infrastructure projects. The multiple regression analysis reveals a number of insights regarding the capital-investment decision of local communities. First, unlike the demand for current expenditures, the demand for capital-investment projects is elastic with respect to tax price. Second, unlike the demand for current expenditures, the demand for capital projects is not directly related to changes in income. Finally, intergovernmental grants are shown to be an important determinant of capital investment spending although the specific aid doesn’t always seem to stick where it initially hits.

Keywords: public capital; demand for public infrastructure spending; intergovernmental aid; price and income elasticity (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/1091142114527782 (text/html)

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:sae:pubfin:v:43:y:2015:i:5:p:586-605

DOI: 10.1177/1091142114527782

Access Statistics for this article

More articles in Public Finance Review
Bibliographic data for series maintained by SAGE Publications ().