Effect of infrastructure investments on total factor productivity (TFP) in Brazilian agriculture

Sergio Magno Mendes, Erly Cardoso Teixeira and Marcio Salvato ()

No 53441, Working Papers in Applied Economics from Universidade Federal de Vicosa, Departamento de Economia Rural

Abstract: Since the 1980s, the investments in infrastructure have been significantly reduced, jeopardizing Total Factor Productivity (TFP) and competitiveness of Brazilian agriculture. The Solow growth model with panel data is used to estimate TFP. An adaptation of the Zhang and Fan (2004) model for India, using the Generalized Method of Moments (GMM), is applied to study the effects of infrastructure investments on TFP. The lack of such investments in Brazil caused the effects to be larger and with lag periods smaller than in other countries. These investments affect TFP in the first years, and the study suggests that the return occurs in the period from zero to two years. Among the analyzed infrastructure elements, investments in roads have the greatest impact on TFP, followed by research, telecommunications, irrigation and electricity.

Keywords: Agricultural and Food Policy; Public Economics (search for similar items in EconPapers)
Pages: 15
Date: 2008
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Citations: View citations in EconPapers (3)

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Working Paper: Effect of infrastructure investments on total factor productivity (TFP) in Brazilian agriculture (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ufvdwp:53441

DOI: 10.22004/ag.econ.53441

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