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Title: International Aspects of Public Infrastructure Investment.
Authors: Bougheas, Spiros
Demetriades, Panicos O.
Morgenroth, Edgar L.W.
First Published: Jun-2001
Publisher: Dept. of Economics, 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.
Series/Report no.: Papers in Economics
Type: Report
Appears in Collections:Reports, Dept. of Economics

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