PRODUCTIVITY EFFECTS OF PUBLIC CAPITAL MAINTENANCE: EVIDENCE FROM U.S. STATES. (26th August 2014)

• Record Type: Journal Article
• Authors: Kalyvitis, Sarantis; Vella, Eugenia
• Is Part Of: Economic inquiry. Volume 53:Number 1(2015:Jan.)
• Page Start: 72
• Page End: 90
• Publication Date: 2014-08-26
• Subjects: Economics -- Periodicals; 330.05
• DOI: 10.1111/ecin.12136
• Languages: English
• ISSNs: 0095-2583

Abstract

<abstract abstract-type="main" id="ecin12136-abs-0001"> <title> <x xml:space="preserve">Abstract</x> </title> <p id="ecin12136-para-0001"> <italic>This article assesses the productivity effects of infrastructure operation and maintenance (O&amp;M) spending by state and local governments in the 48 contiguous U.S. states over the period 1978–2000. We explicitly account for transboundary spillovers of capital and O&amp;M spending and follow a semiparametric methodology that allows us to estimate state‐specific output elasticities. We find strong evidence that in all 48 states the cross‐state spillover effects of O&amp;M outlays on productivity exceed their within‐state impacts and are substantially higher than the spillover effects of capital expenditure.</italic> (<italic>JEL</italic> C14, E22, E62, H76, O11, O47, R11)</p> </abstract>