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Hitting the Trillion Mark -- A Look at How Much Countries Are Spending on Infrastructure

Author

Listed:
  • Fay,Marianne
  • Lee,Hyoung Il
  • Mastruzzi,Massimo
  • Han,Sungmin
  • Cho,Moonkyoung

Abstract

The paper provides the first consistently estimated data set on infrastructure investments in low- and middle-income countries. To do so, the authors identify three possible proxies for infrastructure investments: two are variants on gross fixed capital formation from national accounts system data following ADB (2017) and one is based on fiscal data from the World Bank's BOOST database. Two of these proxies rely on the World Bank's Private Participation in Infrastructure database to capture the private share of infrastructure investments. Given the limitations of each of these proxies, the authors employ several transformations to derive a lower-bound estimate for infrastructure investments in low-and middle-income countries of 3.40 percent of their gross domestic product, a central estimate of around 4 percent, and an upper-bound estimate of 5 percent for 2011. Corresponding absolute amounts are US$0.82 trillion, US$1.00 trillion, and US$1.21 trillion, respectively with East Asia and the Pacific accounting for 55 percent of infrastructure investments and Africa 4 percent. The public sector largely dominates infrastructure spending, accounting for 87?91 percent of infrastructure investments, but with wide variation across regions, from a low of 53?64 percent in South Asia to a high of 98 percent in East Asia. Given the absence of fiscal or national accounts data capturing investments in infrastructure, these estimates are likely to be the best available in the near future. Nevertheless, the authors propose some possible avenues for future improvements (including an update when 2017 data are made available by the International Comparison Project), building on the excellent collaboration of multilateral development banks around this issue.

Suggested Citation

  • Fay,Marianne & Lee,Hyoung Il & Mastruzzi,Massimo & Han,Sungmin & Cho,Moonkyoung, 2019. "Hitting the Trillion Mark -- A Look at How Much Countries Are Spending on Infrastructure," Policy Research Working Paper Series 8730, The World Bank.
  • Handle: RePEc:wbk:wbrwps:8730
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    Citations

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    Cited by:

    1. Xuehui Han & Jiaqi Su & Jang Ping Thia, 2021. "Impact of infrastructure investment on developed and developing economies," Economic Change and Restructuring, Springer, vol. 54(4), pages 995-1024, November.
    2. Thia, Jang Ping & Ong Lopez, Anne, 2023. "Infrastructure quality and trade liberalization," Structural Change and Economic Dynamics, Elsevier, vol. 66(C), pages 134-150.
    3. Fay, Marianne & Martimort, David & Straub, Stéphane, 2021. "Funding and financing infrastructure: The joint-use of public and private finance," Journal of Development Economics, Elsevier, vol. 150(C).
    4. Joseph,George & Ayling,Sophie Charlotte Emi & Miquel-Florensa,Pepita & Bejarano,Hernán D. & Cardona,Alejandra Quevedo, 2021. "Behavioral Insights in Infrastructure Sectors : A Survey," Policy Research Working Paper Series 9704, The World Bank.
    5. Justin Yifu Lin & Yan Wang, 2022. "Financing Infrastructure," Chapters, in: Lili Yan Ing & Dani Rodrik (ed.), New Normal, New Technologies, New Financing, chapter 10, pages 114-129, Economic Research Institute for ASEAN and East Asia (ERIA).
    6. Oughton, Edward J. & Comini, Niccolò & Foster, Vivien & Hall, Jim W., 2022. "Policy choices can help keep 4G and 5G universal broadband affordable," Technological Forecasting and Social Change, Elsevier, vol. 176(C).
    7. Michael Neuman, 2020. "Infrastructure Is Key to Make Cities Sustainable," Sustainability, MDPI, vol. 12(20), pages 1-17, October.
    8. Gurara, Daniel & Kpodar, Kangni & Presbitero, Andrea F. & Tessema, Dawit, 2021. "On the capacity to absorb public investment: How much is too much?☆," World Development, Elsevier, vol. 145(C).
    9. Vorisek,Dana Lauren & Yu,Shu, 2020. "Understanding the Cost of Achieving the Sustainable Development Goals," Policy Research Working Paper Series 9164, The World Bank.
    10. Yury K. Zaytsev, 2022. "International Development Assistance to Large Infrastructure Projects in the Countries of Central Asia [Международная Помощь Развитию Крупных Инфраструктурных Проектов В Странах Центральной Азии]," Russian Economic Development, Gaidar Institute for Economic Policy, issue 10, pages 24-34, October.
    11. Etheldreder Trecia Koppa & Innocent Musonda & Sambo Lyson Zulu, 2023. "A Systematic Literature Review on Local Sustainability Assessment Processes for Infrastructure Development Projects in Africa," Sustainability, MDPI, vol. 15(2), pages 1-37, January.
    12. Patrucco, Andrea S. & Moretto, Antonella & Knight, Louise, 2021. "Does relationship control hinder relationship commitment? The role of supplier performance measurement systems in construction infrastructure projects," International Journal of Production Economics, Elsevier, vol. 233(C).
    13. Dina Passman & Sabine O’Hara & Yolandra Plummer, 2024. "Understanding the Role of Public Transportation in Supporting the Care Economy in Washington, DC, USA," Sustainability, MDPI, vol. 16(3), pages 1-22, February.
    14. Wolf, Christina, 2023. "Demand-growth in support of structural change: Evidence from Nigeria's formal manufacturing sector," Structural Change and Economic Dynamics, Elsevier, vol. 67(C), pages 347-358.

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