In this note, I will examine policy that might encourage greater public infrastructure investment. Much of the discussion will center around H.R. 1452, a bill that was introduced to the House of Representatives in 1999. This bill provided a novel financing method, the primary purpose of which was to provide interest-free loans to state and local governments that would use the money to improve i...

The productivity e¤ect of public infrastructure investment is controversial in the traditional literature using aggregate production function estimation, mainly due to reverse causality. This paper develops a new approach, using a model of endogenous productivity in a …rm-level production function, and matching Chinese …rm-level production data with province-level infrastructure data. The estim...

First passage model specifies a credit default, when the underlying drops below a certain barrier. An investment failure often occurs unexpectedly and involves significant losses to the project value, which makes a great similarity to a default event preventing the investor paying back its debt. In this paper we aim to link the two theories, where an investment failure is determined through the...

There is over the last few years a clear trend in Europe to privatise traditional govemmental tasks, also because of new EU legislation. Many of these tasks have traditionally been carried out by the govemment itself, largely because of the ‘natura1 monopoly’ argument. Examples of current and future privatisation polities are the telecommunication and energy sector. For transport infrastructure...

In transportation planning there can be long lead times to adapt capacity. This paper addresses two questions. First, in a one mode world (say rail or road), what is the optimal capacity choice when faced with uncertain demand, long lead times and congestion. Using a simple analytical model it is shown that when demand is inelastic, it is socially optimal to invest more than if only the expecte...