How Productive is Public Capital? A Meta-Analysis

P.R. Duarte Bom, J.E. Ligthart

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Abstract

The paper analyzes the contribution of public capital to private output using several metaanalytical techniques. Both fixed and random effects models are estimated by Weighted Least Squares. Sample overlap across studies is explicitly controlled for by employing a `full' Generalized Least Squares estimator. The weighted average output elasticity of public capital amounts to 0.08 after correcting for publication bias. A substantial part of the heterogeneity across studies is explained by study design parameters, such as econometric specification, estimation technique, empirical model, type of public capital, and level of aggregation of public capital data. The large elasticities of public capital found in the early literature seem to be caused by either unidentified (but present) cointegrating relationships or spurious relationships in national time series.
Original languageEnglish
Place of PublicationTilburg
PublisherMacroeconomics
Number of pages47
Volume2008-10
Publication statusPublished - 2008

Publication series

NameCentER Discussion Paper
Volume2008-10

Keywords

  • public capital
  • infrastructure
  • public investment
  • meta-analysis
  • meta-regression analysis
  • publication bias

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    Duarte Bom, P. R., & Ligthart, J. E. (2008). How Productive is Public Capital? A Meta-Analysis. (CentER Discussion Paper; Vol. 2008-10). Macroeconomics.