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The Impact of Road Infrastructure on Productivity and Growth: Some Preliminary Results for the German Manufacturing Sector

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  • Andreas Stephan

Abstract

Using time-series cross-section data from the manufacturing sector of the 11 Bundesländer from 1970 to 1993, we examine the impact of road infrastructure on private production applying three different approaches; i.e., a Cobb-Douglas production function, a translog production function and a growth accounting approach. Our econometric analysis explicitly takes into account four of the most frequent problems in the context of time-series cross-section analysis: serial correlation, groupwise heteroscedasticity, cross-sectional correlation and nonstationarity of data. For all approaches and tested specifications, we find that road infrastructure is significant for production in the manufacturing sector. Moreover, we find that variations between the Bundesländer are more important for explaining infrastructure's contribution to production than variations across years. ZUSAMMENFASSUNG - (Der Einfluß von Straßeninfrastruktur auf Wachstum und Produktivität: Einige vorläufige Ergebnisse für das produzierende Gewerbe in Deutschland) Das Arbeitspapier untersucht den Einfluß von Straßeninfrastruktur auf Produktivität und Wachstum im verarbeitenden Gewerbe in Deutschland für den Zeitraum 1970-1993. Den Hintergrund bildet die in der Literatur kontrovers diskutierte sogenannte Hypothese über das "Defizit an öffentlichem Kapital", wonach der seit Anfang der siebziger Jahren zu beobachtende allgemeine Rückgang des Produktivitätswachstum auf die in diesem Zeitraum ebenfalls zurückgegangenen öffentlichen Infrastrukturinvestitionen zurückgeführt werden kann. Die empirische Analyse wird mit einem Paneldatensatz auf Ebene der 11 westdeutschen Bundesländer durchgeführt. Zwei Wirkungsweisen von Infrastruktur auf die private Produktion werden unterschieden. Erstens können Firmen öffentliche Infrastruktur quasi wie ein kostenloses "Zwischenprodukt" für die Produktion nutzen. Zweitens kann Infrastruktur ähnlich wie technischer Fortschritt die Produktivität der privaten Produktionsfaktoren erhöhen. Im vorliegenden Papier werden beide Wirkungen von Infrastruktur erörtert. Im ersten Teil wird eine einfache Cobb-Douglas Produktionsfunktion geschätzt, in welcher Straßeninfrastruktur als ein Faktorinput in die Produktion eingeht. Es wird gezeigt, daß auf Basis der Cobb-Douglas Funktion die beiden Wirkungen von Infrastruktur empirisch nicht unterschieden werden können. Im zweiten Teil wird der Einfluß von Infrastruktur auf die Wachstumsrate der totalen Faktorproduktivität im verarbeitenden Gewerbe untersucht. Im dritten und abschließenden Teil wird mit einer Translog-Produktionsfunktion die Beziehung zwischen Infrastruktur und den privaten Inputfaktoren analysiert. Insgesamt zeigen die Ergebnisse eine starke Korrelation zwischen dem Produktivitätswachstum im verarbeitenden Gewerbe und der Straßeninfrastruktur. Allerdings ist diese Korrelation im Querschnittsvergleich der Bundesländer stärker ausgeprägt als innerhalb der einzelnen Zeitreihen. Die Hypothese über "das Defizit an öffentlichem Kapital" wird daher für das verarbeitende Gewerbe in Deutschland im Rahmen dieser Studie nicht bestätigt.

Suggested Citation

  • Andreas Stephan, 1997. "The Impact of Road Infrastructure on Productivity and Growth: Some Preliminary Results for the German Manufacturing Sector," CIG Working Papers FS IV 97-47, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
  • Handle: RePEc:wzb:wzebiv:fsiv97-47
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    Cited by:

    1. Axel Schaffer & Jochen Siegele, 2008. "Regionale Potentiale – Bedeutung und Nutzung von Potentialfaktoren in den NUTS 3 Regionen Deutschlands und Österreichs," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 28(2), pages 109-132, September.
    2. Barabas, György & Kitlinski, Tobias & Schmidt, Christoph M. & Schmidt, Torsten & Siemers, Lars-H. & Brilon, Werner, 2010. "Verkehrsinfrastrukturinvestitionen: Wachstumsaspekte im Rahmen einer gestaltenden Finanzpolitik. Endbericht - Januar 2010. Forschungsprojekt im Auftrag des Bundesministeriums der Finanzen. Projektnumm," RWI Projektberichte, RWI - Leibniz-Institut für Wirtschaftsforschung, number 72601.
    3. Leopoldo Laborda & Daniel Sotelsek, 2019. "Effects of Road Infrastructure on Employment, Productivity and Growth: An Empirical Analysis at Country Level," Journal of Infrastructure Development, India Development Foundation, vol. 11(1-2), pages 81-120, June.
    4. Heinz Handler & Andreas Knabe & Bertrand Koebel & Margit Schratzenstaller & Sven Wehke, 2005. "The Impact of Public Budgets on Overall Productivity Growth," WIFO Working Papers 255, WIFO.
    5. Kolomak, E., 2011. "Efficiency of Infrastructure Capital in Russia," Journal of the New Economic Association, New Economic Association, issue 10, pages 74-93.
    6. Stephanie Aubert & Andreas Stephan, 2000. "Regional Infrastructure Policy and its Impact on Productivity: A Comparison of Germany and France," CIG Working Papers FS IV 00-02, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
    7. Heinz Handler & Margit Schratzenstaller, 2006. "Teilstudie 7: Die Rolle des Staates," WIFO Studies, WIFO, number 27446, February.
    8. Mark Lijesen & Victoria Shestalova, 2007. "Public and private roles in road infrastructure: an exploration of market failure, public instruments and government failure," CPB Document 146, CPB Netherlands Bureau for Economic Policy Analysis.
    9. A. J. Khadaroo & B. Seetanah, 2007. "Assessing the contribution of land, sea and air transport capital to the economic performance of the small island state of Mauritius," Applied Economics Letters, Taylor & Francis Journals, vol. 14(15), pages 1151-1155.

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    Keywords

    public infrastructure; manufacturing sector; total factor productivity growth; time-series cross-section data analysis;
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