Public Infrastructure, Education, and Economic Growth: Region-Specific Complementarity in a Half-Century Panel of States
AbstractWe find region-specific complementarity between investments in public infrastructure and education, both k-12 and postsecondary. The complementarity helps to explain how regions capture returns to investments in education even when residents are mobile, and is strong enough for the effect of tax-financed expenditures on either public infrastructure or education to be significantly positive when spending on the other is high, even though the independent effect of either one is negative. Effects are identified using a recursive structure, very long lags, GMM-instrumental variables, and multiple controls for heterogeneity. Estimates are robust across identification strategies, estimators, and instruments.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 21745.
Date of creation: Mar 2010
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infrastructure; education complementarity economic growth;
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- J00 - Labor and Demographic Economics - - General - - - General
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