Public Capital and Output Growth in Portugal: An Empirical Analysis

Jenny Ligthart

No 2000/011, IMF Working Papers from International Monetary Fund

Abstract: The paper investigates the growth effects of public capital in Portugal using annual data for the period 1965-95. Both a production function and a vector autoregressive model are estimated. Public capital is shown to be a significant long-term determinant of output growth. The size of the estimated production elasticity indicates, in line with studies for other countries, a substantial growth payoff from public investment. Disaggregating public capital shows that investment related to, among other things, roads, railways, and airports is more productive than public investment in other major categories.

Keywords: WP; capital stock; public capital; capital; cointegration; granger causality; infrastructure; public investment; Engle-Granger result; least squares; constant returns to scale; output effect; time series; utilization rate; Public investment and public-private partnerships (PPP); Stocks; Vector autoregression; Government debt management; Capital productivity (search for similar items in EconPapers)
Pages: 37
Date: 2000-01-01
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Citations: View citations in EconPapers (30)

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Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2000/011

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