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The Impact of Public Infrastructure on the Productivity of the Chilean Economy

Author

Listed:
  • Jose Miguel Albala-Bertrand

    (Queen Mary, University of London)

  • Emmanouel C. Mamatzakis

    (City University Business School)

Abstract

The aim of the present study is to assess the effect of public infrastructures on the cost structure of the Chilean economy, and thereby on productivity, differentiating between two key sequential periods. A derived aim is to establish to what extent infrastructure and non-infrastructure capitals are related. Our conclusions appear to indicate that infrastructure capital reduces the production cost of the economy, thereby increasing productivity, only in the second period. In turn, non-infrastructure capital appears to be mostly unrelated to infrastructure capital in the first period, but to be clearly complementary in the second period. In addition, infrastructure capital and labour appear to be substitutive in the first period, but mostly unrelated in the second period. Complementarity, neutrality and substitution can to a large extent be explained by the dramatic differences in the institutional structures between these two periods.

Suggested Citation

  • Jose Miguel Albala-Bertrand & Emmanouel C. Mamatzakis, 2001. "The Impact of Public Infrastructure on the Productivity of the Chilean Economy," Working Papers 435, Queen Mary University of London, School of Economics and Finance.
    • Handle: RePEc:qmw:qmwecw:435
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Infrastructure; Chilean institutional change; Translog cost function;
    All these keywords.

    JEL classification:

    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables

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