Coordination of Infrastructure Investment Across Levels of Government

The share of public investment spending at sub-national level has been slowly but steadily increasing over the past two decades across OECD countries. Degrees and forms of decentralization in infrastructure vary widely across countries, but all governments share a common objective, that is to mobilize authorities along shared infrastructure policy objectives. This involves managing a complex web of vertical (across levels of government) and horizontal (across sectors and across the same levels of government) interdependencies, which require substantial coordination among actors to ensure policy alignment and quality investments. Asymmetric information, multiple principal-agent relationships and significant differences in capacities across levels of government in financing and implementing infrastructure investments have posed important political economic obstacles to improving the efficiency and effectiveness of public investment outcomes. This paper will look at persisting coordination challenges more closely by using the results of a recent OECD questionnaire and case studies. It will identify remedies OECD and some selected non-OECD countries have found that work to address coordination issues. This paper will demonstrate that ultimately systematic collection and sharing of information is the key to making coordination work.