IDEAS home Printed from https://ideas.repec.org/a/bla/presci/v87y2008i1p3-31.html
   My bibliography  Save this article

Regional macroeconomic outcomes under alternative arrangements for the financing of public infrastructure

Author

Listed:
  • James Giesecke
  • Peter B. Dixon
  • Maureen T. Rimmer

Abstract

. We use a dynamic multi‐regional CGE model (MMRF) to evaluate the regional macroeconomic consequences of four methods of financing a program of regional government infrastructure provision. The methods are developer charges, debt, payroll tax and residential rates. We demonstrate that the net gains from a program of public infrastructure development are quite sensitive to the chosen financing means. The net gains are greatest under rates and debt financing, and least under developer charges and payroll tax financing. Abstract. Usamos un modelo CGE multirregional dinámico (MMRF) para evaluar las consecuencias macroeconómicas regionales de cuatro métodos de financiación de un programa de financiamiento de infraestructura por parte de un gobierno regional. Los métodos son cargas al contratista (developer charges), deuda, impuestos salariales y contribución urbana. Demostramos que el beneficio neto de un programa de desarrollo de infraestructura pública es bastante sensible a los medios de financiación elegidos. El beneficio neto es mayor mediante la financiación por contribución y deuda, y menor con la financiación por cargas al contratista e impuestos salariales.

Suggested Citation

  • James Giesecke & Peter B. Dixon & Maureen T. Rimmer, 2008. "Regional macroeconomic outcomes under alternative arrangements for the financing of public infrastructure," Papers in Regional Science, Wiley Blackwell, vol. 87(1), pages 3-31, March.
    • Handle: RePEc:bla:presci:v:87:y:2008:i:1:p:3-31
    DOI: 10.1111/j.1435-5957.2007.00147.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1435-5957.2007.00147.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1435-5957.2007.00147.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. 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.
    2. Kevin T. Duffy-Deno & Randall W. Eberts, 1996. "Public Infrastructure and Regional Economic Development: A Simultaneous Equations Approach," Book chapters authored by Upjohn Institute researchers, in: Niles Hansen & Kenneth J. Button & Peter Nijkamp (ed.),Regional Policy and Regional Integration, pages 295-309, W.E. Upjohn Institute for Employment Research.
    3. Morgan, William & Mutti, John & Rickman, Dan, 1996. "Tax Exporting, Regional Economic Growth, and Welfare," Journal of Urban Economics, Elsevier, vol. 39(2), pages 131-159, March.
    4. Demetriades, Panicos O & Mamuneas, Theofanis P, 2000. "Intertemporal Output and Employment Effects of Public Infrastructure Capital: Evidence from 12 OECD Economics," Economic Journal, Royal Economic Society, vol. 110(465), pages 687-712, July.
    5. Garcia-Mila, Teresa & McGuire, Therese J., 1992. "The contribution of publicly provided inputs to states' economies," Regional Science and Urban Economics, Elsevier, vol. 22(2), pages 229-241, June.
    6. Alicia H. Munnell, 1992. "Policy Watch: Infrastructure Investment and Economic Growth," Journal of Economic Perspectives, American Economic Association, vol. 6(4), pages 189-198, Fall.
    7. Naqvi, Farzana & Peter, Matthew W, 1996. "A Multiregional, Multisectoral Model of the Australian Economy with an Illustrative Application," Australian Economic Papers, Wiley Blackwell, vol. 35(66), pages 94-113, June.
    8. David F. Batten & Charlie Karlsson (ed.), 1996. "Infrastructure and the Complexity of Economic Development," Advances in Spatial Science, Springer, number 978-3-642-80266-9, Fall.
    9. Otto, Glenn & Voss, Graham M, 1994. "Public Capital and Private Sector Productivity," The Economic Record, The Economic Society of Australia, vol. 70(209), pages 121-132, June.
    10. Holtz-Eakin, Douglas & Schwartz, Amy Ellen, 1995. "Infrastructure in a structural model of economic growth," Regional Science and Urban Economics, Elsevier, vol. 25(2), pages 131-151, April.
    11. Glenn Otto & Graham M. Voss, 1994. "Public Capital and Private Sector Productivity," The Economic Record, The Economic Society of Australia, vol. 70(209), pages 121-132, June.
    12. Wang, Eric C., 2002. "Public infrastructure and economic growth: a new approach applied to East Asian economies," Journal of Policy Modeling, Elsevier, vol. 24(5), pages 411-435, August.
    13. Leah M. Cook & Alicia H. Munnell, 1990. "How does public infrastructure affect regional economic performance?," New England Economic Review, Federal Reserve Bank of Boston, issue Sep, pages 11-33.
    14. Easterly, William & Rebelo, Sergio, 1993. "Fiscal policy and economic growth: An empirical investigation," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 417-458, December.
    15. Jones, Rich & Whalley, John, 1989. "A Canadian regional general equilibrium model and some applications," Journal of Urban Economics, Elsevier, vol. 25(3), pages 368-404, May.
    16. Jacco Hakfoort, 1996. "Public Capital, Private Sector Productivity and Economic Growth: A Macroeconomic Perspective," Advances in Spatial Science, in: David F. Batten & Charlie Karlsson (ed.), Infrastructure and the Complexity of Economic Development, chapter 0, pages 61-72, Springer.
    17. Matthew W. Peter & Mark Horridge & G.A.Meagher & Fazana Naqvi & B.R.Parmenter, 1996. "The Theoretical Structure of MONASH-MRF," Centre of Policy Studies/IMPACT Centre Working Papers op-85, Victoria University, Centre of Policy Studies/IMPACT Centre.
    18. Dixon, Peter B. & Parmenter, B. R. & Powell, Alan A., 1984. "The role of miniatures in computable general equilibrium modelling : Experience from ORANI," Economic Modelling, Elsevier, vol. 1(4), pages 421-428, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. James Giesecke & Chris Schilling, 2009. "Short term gain, long term pain? Impact of New Zealand’s fiscal stimulus - A dynamic general equilibrium analysis," Macroeconomics Working Papers 23003, East Asian Bureau of Economic Research.
    2. Hadj Salem, Haykel & El-Mehdi, Aboulkacem & Jayet, Hubert & David, Quentin & Hammadou, Hakim & Kilani, Moez, 2016. "Using a CGE Model for analyzing the Macroeconomic impact of the Grand Paris Express project on the Ile-de-France Region," Conference papers 332675, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    3. Giesecke, James A. & Madden, John R., 2013. "Regional Computable General Equilibrium Modeling," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 379-475, Elsevier.
    4. Ahmed, Vaqar & Abbas, Ahsan & Ahmed, Sofia, 2013. "Public Infrastructure and economic growth in Pakistan: a dynamic CGE-microsimulation analysis," PEP Working Papers 164414, Partnership for Economic Policy (PEP).
    5. Jason Nassios & James Giesecke & Xianglong Locky Liu, 2024. "An impossible triangle? The impact of housing policy on affordability, accessibility, and efficiency," Centre of Policy Studies/IMPACT Centre Working Papers g-344, Victoria University, Centre of Policy Studies/IMPACT Centre.
    6. Jason Nassios & John Madden & James Giesecke & Janine Dixon & Nhi Tran & Peter Dixon & Maureen Rimmer & Philip Adams & John Freebairn, 2019. "The economic impact and efficiency of state and federal taxes in Australia," Centre of Policy Studies/IMPACT Centre Working Papers g-289, Victoria University, Centre of Policy Studies/IMPACT Centre.
    7. Ahmed, Vaqar & Abbas, Ahsan & Ahmed, Sofia & Zeshan, Muhammed, 2012. "Public Infrastructure and Economic Growth in Pakistan: A Dynamic CGE- microsimulation Analysis," Conference papers 332289, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    8. James A. Giesecke & Nhi H. Tran, 2018. "The National and Regional Consequences of Australia's Goods and Services Tax," The Economic Record, The Economic Society of Australia, vol. 94(306), pages 255-275, September.
    9. James A. Giesecke & John R. Madden, 2013. "Evidence-based regional economic policy analysis: the role of CGE modelling," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 6(2), pages 285-301.
    10. Hua Zhong & Michael H. Taylor & Kimberly S. Rollins & Dale T. Manning & Christopher G. Goemans, 2019. "Who pays for water scarcity? Evaluating the welfare implications of water infrastructure investments for cities," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 63(3), pages 559-600, December.
    11. Jason Nassios & James Giesecke, 2022. "Property Tax Reform: Implications for Housing Prices and Economic Productivity," Centre of Policy Studies/IMPACT Centre Working Papers g-330, Victoria University, Centre of Policy Studies/IMPACT Centre.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Alfredo M. Pereira & Jorge M. Andraz, 2013. "On The Economic Effects Of Public Infrastructure Investment: A Survey Of The International Evidence," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 38(4), pages 1-37, December.
    2. Pedro R. D. Bom & Jenny Ligthart, 2008. "How Productive is Public Capital? A Meta-Analysis," CESifo Working Paper Series 2206, CESifo.
    3. Pedro R.D. Bom & Jenny E. Ligthart, 2009. "How Productive is Public Capital? A Meta-Regression Analysis," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper0912, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    4. Timilsina,Govinda R. & Hochman,Gal & Song,Ze, 2020. "Infrastructure, Economic Growth, and Poverty : A Review," Policy Research Working Paper Series 9258, The World Bank.
    5. Fedderke, J.W. & Bogetic, Z., 2009. "Infrastructure and Growth in South Africa: Direct and Indirect Productivity Impacts of 19 Infrastructure Measures," World Development, Elsevier, vol. 37(9), pages 1522-1539, September.
    6. Gupta, Sanjeev & Kangur, Alvar & Papageorgiou, Chris & Wane, Abdoul, 2014. "Efficiency-Adjusted Public Capital and Growth," World Development, Elsevier, vol. 57(C), pages 164-178.
    7. Pedro R.D. Bom & Jenny E. Ligthart, 2014. "What Have We Learned From Three Decades Of Research On The Productivity Of Public Capital?," Journal of Economic Surveys, Wiley Blackwell, vol. 28(5), pages 889-916, December.
    8. Fu, Feng-Cheng & Vijverberg, Chu-Ping C. & Vijverberg, Wim P., 2004. "Public Infrastructure as a Determinant of Intertemporal and Interregional Productive Performance in China," IZA Discussion Papers 1019, Institute of Labor Economics (IZA).
    9. Holmgren, Johan & Merkel, Axel, 2017. "Much ado about nothing? – A meta-analysis of the relationship between infrastructure and economic growth," Research in Transportation Economics, Elsevier, vol. 63(C), pages 13-26.
    10. Ozbay, Kaan & Ozmen-Ertekin, Dilruba & Berechman, Joseph, 2007. "Contribution of transportation investments to county output," Transport Policy, Elsevier, vol. 14(4), pages 317-329, July.
    11. William F. Fox & Sanela Porca, 2001. "Investing in Rural Infrastructure," International Regional Science Review, , vol. 24(1), pages 103-133, January.
    12. Ward Romp & Jakob De Haan, 2007. "Public Capital and Economic Growth: A Critical Survey," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 8(S1), pages 6-52, April.
    13. Elburz, Zeynep & Nijkamp, Peter & Pels, Eric, 2017. "Public infrastructure and regional growth: Lessons from meta-analysis," Journal of Transport Geography, Elsevier, vol. 58(C), pages 1-8.
    14. Poot, Jacques, 1999. "A meta-analytic study of the role of government in long-run economic growth," ERSA conference papers ersa99pa171, European Regional Science Association.
    15. Angel De la Fuente, 2010. "Infrastructures and productivity: an updated survey," Working Papers 1018, BBVA Bank, Economic Research Department.
    16. Stephane Straub, 2008. "Infrastructure and Growth in Developing Countries: Recent Advances and Research Challenges," Edinburgh School of Economics Discussion Paper Series 179, Edinburgh School of Economics, University of Edinburgh.
    17. Beckman, Jayson & Hertel, Thomas, 2009. "Why Previous Estimates of the Cost of Climate Mitigation Might Be Too Low," Conference papers 331860, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    18. Federici, Andrea, 2018. "Il rapporto tra capitale pubblico e altre variabili macroeconomiche: analisi della letteratura [The relationship between public capital and other macroeconomic variable: a literature review]," MPRA Paper 88515, University Library of Munich, Germany.
    19. Sylvie Charlot & Virginie Piguet & Bertrand Schmitt, 2003. "Capital public et productivite quels effets sur les disparites regionales ?," Revue d'économie politique, Dalloz, vol. 113(6), pages 851-880.
    20. Boarnet, Marlon G., 1996. "The Direct and Indirect Economic Effects of Transportation Infrastructure," University of California Transportation Center, Working Papers qt1506r290, University of California Transportation Center.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:presci:v:87:y:2008:i:1:p:3-31. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=1056-8190 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.