Some Misconceptions about Public Investment Efficiency and Growth

This study reconsiders the macroeconomic implications of public investment efficiency,

From:
Department for International Development
Published
23 December 2015
Document Type:
Working Paper
Theme:
Economic Growth
Authors:
Berg, A, Buffie, E.F., Pattillo, C.A., Portillo, R, Presbitero, A, Zanna, L.F.

Abstract

The authors reconsider the macroeconomic implications of public investment efficiency, defined as the ratio between the actual increment to public capital and the amount spent. They show that, in a simple and standard model, increases in public investment spending in inefficient countries do not have a lower impact on growth than in efficient countries, a result confirmed in a simple cross-country regression.

This work is part of the ‘Macroeconomics in Low-income countries’ programme

Citation

Andrew Berg, Edward F Buffie, Catherine A Pattillo, Rafael Portillo, Andrea Presbitero, Luis-Felipe Zanna (2016) Some Misconceptions about Public Investment Efficiency and Growth Working Paper No. 15/272

Some Misconceptions about Public Investment Efficiency and Growth

Published 23 December 2015
Contents