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Calling for innovations - infrastructure and sources of growth

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  • Schiffbauer, Marc

    (Bonn Graduate School of Economics, University of Bonn)

Abstract

This paper analyzes the impact of infrastructure capital on different sources of economic growth. Starting with the contribution of Barro (1990), the literature on infrastructure and growth mainly focuses on the relation between private and public capital investments. In contrast, we demonstrate a link between (telecommunication) infrastructure capital and endogenous technological change in the context of an dynamic panel estimation applying aggregate country- as well as U.S. firm-level data. The main empirical finding is that the increase in telecommunication infrastructure during the last 30 years enhanced R&D investments but did not affect the accumulation of physical or human capital in our sample. Moreover, we provide an extended R&D growth model, which emphasizes a cost-reducing feature of infrastructure capital, to demonstrate a potential link between the level of infrastructure capital and endogenous technological change.

Suggested Citation

  • Schiffbauer, Marc, 2007. "Calling for innovations - infrastructure and sources of growth," Papers DYNREG18, Economic and Social Research Institute (ESRI).
    • Handle: RePEc:esr:wpaper:dynreg18
    Note: DYNREG Research Project – Dynamic Regions in a Knowledge-Driven Global Economy: Lessons and Policy Implications for the European Union
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    Cited by:

    1. Agénor, Pierre-Richard & Neanidis, Kyriakos C., 2015. "Innovation, public capital, and growth," Journal of Macroeconomics, Elsevier, vol. 44(C), pages 252-275.
    2. Alexander Eck & Joachim Ragnitz & Simone Scharfe & Christian Thater & Bernhard Wieland, 2015. "Public Investments in Infrastructure: Development, Causal Factors and Growth Effects," ifo Dresden Studien, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 72.

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