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Preventing competition because of 'solidarity': rhetoric and reality of airport investments in Spain

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  • Germa Bel
  • Xavier Fageda

Abstract

From a public interest perspective, there could be a justification for constraining market mechanisms with the aim of progressive redistribution. However, some policies might be based on selfish motivations of government agents. In this article, we empirically contrast if the infrastructure policy is based only on public interest motivations or if it is also based on the private motivations of policy makers. In this way, Spain infrastructure policy provides a useful policymaking field to test hypothesis about the behaviour of policy makers. We find some evidence regarding the strength of political motivations in explaining such behaviour. In fact, results from our analysis show that political motivations can eventually play a more relevant role than social welfare maximization.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Applied Economics.

Volume (Year): 41 (2009)
Issue (Month): 22 ()
Pages: 2853-2865

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Handle: RePEc:taf:applec:v:41:y:2009:i:22:p:2853-2865

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  1. Andrew Worthington & Brian Dollery, 1998. "The political determination of intergovernmental grants in Australia," Public Choice, Springer, vol. 94(3), pages 299-315, March.
  2. Costa-I-Font, Joan & Rodriguez-Oreggia, Eduardo & Lunapla, Dario, 2003. " Political Competition and Pork-Barrel Politics in the Allocation of Public Investment in Mexico," Public Choice, Springer, vol. 116(1-2), pages 185-204, July.
  3. Anne Case, 1997. "Election Goals and Income Redistribution: Recent Evidence From Albania," Working Papers 227, Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies..
  4. Kevin T. Duffy-Deno & Randall W. Eberts, 1989. "Public infrastructure and regional economic development: a simultaneous equations approach," Working Paper 8909, Federal Reserve Bank of Cleveland.
  5. Behrman, Jere R & Craig, Steven G, 1987. "The Distribution of Public Services: An Exploration of Local Governmental Preferences," American Economic Review, American Economic Association, vol. 77(1), pages 37-49, March.
  6. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March.
  7. Holtz-Eakin, Douglas, 1994. "Public-Sector Capital and the Productivity Puzzle," The Review of Economics and Statistics, MIT Press, vol. 76(1), pages 12-21, February.
  8. Germà Bel & Xavier Fageda, 2008. "Getting there fast: globalization, intercontinental flights and location of headquarters," Journal of Economic Geography, Oxford University Press, vol. 8(4), pages 471-495, July.
  9. Norihiko Yamano & Toru Ohkawara, 2000. "The Regional Allocation of Public Investment: Efficiency or Equity?," Journal of Regional Science, Wiley Blackwell, vol. 40(2), pages 205-229.
  10. Johansson, Eva, 2003. "Intergovernmental grants as a tactical instrument: empirical evidence from Swedish municipalities," Journal of Public Economics, Elsevier, vol. 87(5-6), pages 883-915, May.
  11. Cadot, Olivier & Röller, Lars-Hendrik & Stephan, Andreas, 1999. "A Political Economy Model of Infrastructure Allocation: An Empirical Assessment," CEPR Discussion Papers 2336, C.E.P.R. Discussion Papers.
  12. Bhargava, A & Franzini, L & Narendranathan, W, 1982. "Serial Correlation and the Fixed Effects Model," Review of Economic Studies, Wiley Blackwell, vol. 49(4), pages 533-49, October.
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Cited by:
  1. Germá Bel & Xavier Fageda, 2011. "La reforma del modelo de gestión de aeropuertos en España: ¿Gestión conjunta o individual?," Hacienda Pública Española, IEF, vol. 196(1), pages 109-130, january.
  2. Andreas Kappeler & Albert Solé-Ollé & Andreas Stephan & Timo Välilä, 2012. "Does Fiscal Decentralisation Foster Regional Investment in Productive Infrastructure?," Discussion Papers of DIW Berlin 1204, DIW Berlin, German Institute for Economic Research.
  3. Daniel Albalate & Germà Bel & Xavier Fageda, 2013. "“When supply travels far beyond demand: Institutional and regulatory causes of oversupply in Spain’s transport infrastructure”," IREA Working Papers 201312, University of Barcelona, Research Institute of Applied Economics, revised Jun 2013.
  4. Germá Bel & Xavier Fageda, 2009. "Factors Explaining Charges in European Airports: Competition, Market Size, Private Ownership and Regulation," Working Papers 2009-31, FEDEA.

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