Public Infrastructure and Structural Transformation

This study argues that public infrastructure is an important though previously neglected driving mechanism of the structural transformation process. To assess its significance quantitatively, this study first develops a multisector neoclassical gro...

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Main Authors:	Perez Sebastian, Fidel, Steinbuks, Jevgenijs
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2017
Subjects:	INFRASTRUCTURE FIRM ENTRY PUBLIC INVESTMENT MANAGEMENT STRUCTURAL TRANSFORMATION
Online Access:	http://documents.worldbank.org/curated/en/663871513692700637/Public-infrastructure-and-structural-transformation http://hdl.handle.net/10986/29076

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recordtype	oai_dc
spelling	okr-10986-290762021-06-08T14:42:47Z Public Infrastructure and Structural Transformation Perez Sebastian, Fidel Steinbuks, Jevgenijs INFRASTRUCTURE FIRM ENTRY PUBLIC INVESTMENT MANAGEMENT STRUCTURAL TRANSFORMATION This study argues that public infrastructure is an important though previously neglected driving mechanism of the structural transformation process. To assess its significance quantitatively, this study first develops a multisector neoclassical growth model with heterogeneous firms, where public infrastructure contributes to firms' production and mitigates the barriers to firms' entry. The model is calibrated using data from Brazil, a country that has significantly expanded its infrastructure in recent decades, yet remains in deep need of further infrastructure improvements. The accumulation of infrastructure accelerates the structural transformation through generating higher returns and lowering entry costs in sectors with greater public capital intensity. In the simulations, public capital formation explains about 15 percent of the process. The paper also shows the effects of different barriers to public capital formation on the structural transformation and GDP per capita. 2017-12-21T20:28:24Z 2017-12-21T20:28:24Z 2017-12 Working Paper http://documents.worldbank.org/curated/en/663871513692700637/Public-infrastructure-and-structural-transformation http://hdl.handle.net/10986/29076 English Policy Research Working Paper;No. 8285 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Latin America & Caribbean Brazil
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	INFRASTRUCTURE FIRM ENTRY PUBLIC INVESTMENT MANAGEMENT STRUCTURAL TRANSFORMATION
spellingShingle	INFRASTRUCTURE FIRM ENTRY PUBLIC INVESTMENT MANAGEMENT STRUCTURAL TRANSFORMATION Perez Sebastian, Fidel Steinbuks, Jevgenijs Public Infrastructure and Structural Transformation
geographic_facet	Latin America & Caribbean Brazil
relation	Policy Research Working Paper;No. 8285
description	This study argues that public infrastructure is an important though previously neglected driving mechanism of the structural transformation process. To assess its significance quantitatively, this study first develops a multisector neoclassical growth model with heterogeneous firms, where public infrastructure contributes to firms' production and mitigates the barriers to firms' entry. The model is calibrated using data from Brazil, a country that has significantly expanded its infrastructure in recent decades, yet remains in deep need of further infrastructure improvements. The accumulation of infrastructure accelerates the structural transformation through generating higher returns and lowering entry costs in sectors with greater public capital intensity. In the simulations, public capital formation explains about 15 percent of the process. The paper also shows the effects of different barriers to public capital formation on the structural transformation and GDP per capita.
format	Working Paper
author	Perez Sebastian, Fidel Steinbuks, Jevgenijs
author_facet	Perez Sebastian, Fidel Steinbuks, Jevgenijs
author_sort	Perez Sebastian, Fidel
title	Public Infrastructure and Structural Transformation
title_short	Public Infrastructure and Structural Transformation
title_full	Public Infrastructure and Structural Transformation
title_fullStr	Public Infrastructure and Structural Transformation
title_full_unstemmed	Public Infrastructure and Structural Transformation
title_sort	public infrastructure and structural transformation
publisher	World Bank, Washington, DC
publishDate	2017
url	http://documents.worldbank.org/curated/en/663871513692700637/Public-infrastructure-and-structural-transformation http://hdl.handle.net/10986/29076
_version_	1764468433969217536

Public Infrastructure and Structural Transformation

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