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An analysis of the relationship between infrastructure investment and economic growth in Mexican urban areas, 1985-2008

Author

Listed:
  • Vicente German-Soto

    (Autonomous University of Coahuila)

  • Luis Gutierrez Flores

    (Autonomous University of Coahuila)

  • Hector Alonso Barajas Bustillos

    (Autonomous University of Ciudad Juarez)

Abstract

The relationship between infrastructure investment and economic growth in Mexican urban areas 1985-2008 is analyzed using several panel cointegration tests that control for heterogeneity and serial correlation. Data are found to be stationary in first differences but not levels. The long run cointegrated relationship between certain kinds of infrastructure measures such as water supply, a global infrastructure index, road infrastructure, vehicle density, highways, and a social infrastructure index combined with the finding of no relationship with other measures favors a policy of targeted infrastructure investments by both the private and public sectors.

Suggested Citation

  • Vicente German-Soto & Luis Gutierrez Flores & Hector Alonso Barajas Bustillos, 2017. "An analysis of the relationship between infrastructure investment and economic growth in Mexican urban areas, 1985-2008," Economics Bulletin, AccessEcon, vol. 37(4), pages 2422-2433.
    • Handle: RePEc:ebl:ecbull:eb-16-00379
    as

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    References listed on IDEAS

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    More about this item

    Keywords

    economic growth; infrastructure; panel data; unit roots; cointegration;
    All these keywords.

    JEL classification:

    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling

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