International Aspects of Public Infrastructure Investment

Spiros Bougheas, Panicos Demetriades and Edgar Morgenroth

No 01/4, Discussion Papers in Economics from Division of Economics, School of Business, University of Leicester

Abstract: Modelling infrastructure as an international public good in a two-country model of trade where each country’s social planner behaves strategically, we show that the equilibrium levels of infrastructure are sub-optimal from a global perspective. Utilising an appropriate econometric framework and data from 16 European countries over the period 1987-95, we find evidence that accords well with the main predictions of our theory. Thus, we are able to offer a plausible theoretical explanation why public capital may be undersupplied, as suggested by previous empirical literature.

JEL-codes: F10 F42 H42 (search for similar items in EconPapers)
Date: 2001-06
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: International aspects of public infrastructure investment (2003)
Journal Article: International aspects of public infrastructure investment (2003)
Working Paper: International Aspects of Public Infrastructure Investment (1998)
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