Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/26144 
Year of Publication: 
2007
Series/Report no.: 
CESifo Working Paper No. 2099
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
It has been frequently quoted in the literature that one decisive cause of the productive performance of an economy might be infrastructure investment. This paper provides a dual profit theoretical framework of measuring the effects of infrastructure on economic performance in terms of gains in profits, cost savings, as well as in terms of productivity growth enhancement. In an empirical application, we opt for Mexican industry data. The results show that returns to infrastructure capital are significant and positive, though some variability across time exists. Moreover, the decomposition of total factor productivity growth reveals that the economic performance could be enhanced by investing in infrastructure capital.
JEL: 
D21
D24
H54
E62
Document Type: 
Working Paper
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