Public Infrastructure, Private Input Demand, and Economic Performance of the Greek Industry

Queen Mary & Westfield College Working Paper No. 406

23 Pages Posted: 18 Oct 1999

Date Written: February 1999

Abstract

In this paper we examine the effects of the services provided by public infrastructure on the cost structure, private input demands, and productivity performance of twenty two-digit Greek manufacturing industries. The model of the paper is the dual cost function. Although the effects of public infrastructure varies across different industries our results provide evidence in favour of a productive public infrastructure. In addition, public infrastructure is found to be complement to private capital stock and substitute to labour. Specifically, the cost-saving impact of public infrastructure ranges from 0.02 percent in food manufacturing industry to 0.78 percent in wood and cork. Moreover, empirical evidence is provided in favour of the argument that the productivity growth of the majority of the twenty Greek manufacturing industries has been depressed by the observed shortage in public infrastructure in the eighties.

JEL Classification: H54, E62, L60

Suggested Citation

Mamatzakis, Emmanuel C. Manolis, Public Infrastructure, Private Input Demand, and Economic Performance of the Greek Industry (February 1999). Queen Mary & Westfield College Working Paper No. 406. Available at SSRN: https://ssrn.com/abstract=185635 or http://dx.doi.org/10.2139/ssrn.185635

Emmanuel C. Manolis Mamatzakis (Contact Author)

University of Macedonia ( email )

Thessaloniki, 54006
Greece

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