The Impact of Public Infrastructure on the Productivity of the Chilean Economy

U of London Queen Mary Economics Working Paper No. 435

23 Pages Posted: 23 Feb 2001

Multiple version iconThere are 2 versions of this paper

Date Written: February 2001

Abstract

The aim of the present study is to assess the effect of public infrastructures on the cost structure of the Chilean economy, and thereby on productivity, differentiating between two key sequential periods. A derived aim is to establish to what extent infrastructure and non-infrastructure capitals are related. Our conclusions appear to indicate that infrastructure capital reduces the production cost of the economy, thereby increasing productivity, only in the second period. In turn, non-infrastructure capital appears to be mostly unrelated to infrastructure capital in the first period, but to be clearly complementary in the second period. In addition, infrastructure capital and labour appear to be substitutive in the first period, but mostly unrelated in the second period. Complementarity, neutrality and substitution can to a large extent be explained by the dramatic differences in the institutional structures between these two periods.

Keywords: infrastructure, Chilean institutional change, translog cost function

JEL Classification: H54, O4, C3

Suggested Citation

Albala-Bertrand, José Miguel and Mamatzakis, Emmanuel C. Manolis, The Impact of Public Infrastructure on the Productivity of the Chilean Economy (February 2001). U of London Queen Mary Economics Working Paper No. 435. Available at SSRN: https://ssrn.com/abstract=261313 or http://dx.doi.org/10.2139/ssrn.261313

José Miguel Albala-Bertrand (Contact Author)

Queen Mary, University of London ( email )

Mile End Road
Queens' W309
London E1 4NS
United Kingdom
+44 20 7882 5094 Ext. 5094 (Phone)
+44 20 8983 3580 (Fax)

Emmanuel C. Manolis Mamatzakis

University of Macedonia ( email )

Thessaloniki, 54006
Greece

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