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041 _aENG
100 _aAtolia, Manoj
_91
245 _aInvesting in Public Infrastructure
_bRoads or Schools?
260 _aWashington
_bInternational Monetary Fund
_c2017
300 _a44p.
440 _aIMF Working Paper Series
_nWP/17/105
_91
520 _aWhy do governments in developing economies invest in roads and not enough in schools? In the presence of distortionary taxation and debt aversion, the different pace at which roads and schools contribute to economic growth turns out to be central to this decision. Specifically, while costs are front-loaded for both types of investment, the growth benefits of schools accrue with a delay. To put things in perspective, with a “big push,” even assuming a large (15 percent) return differential in favor of schools, the government would still limit the fraction of the investment scale-up going to schools to about a half. Besides debt aversion, political myopia also turns out to be a crucial determinant of public investment composition. A “big push,” by accelerating growth outcomes, mitigates myopia—but at the expense of greater risks to fiscal and debt sustainability. Tied concessional financing and grants can potentially mitigate the adverse effects of both debt aversion and political myopia.
650 _aEducation
_91
650 _a Public investment
_91
650 _aDebt sustainability
_91
650 _aHuman capital
_91
650 _aPolitical myopia
_91
650 _aDebt aversion
_91
650 _aLow income developing countries
_91
650 _aDeveloping countries
_91
650 _aIMF
_91
700 _aLi, Bin Grace
_91
700 _aMarto, Ricardo
_91
700 _aMelina, Giovanni
_91
710 _aIMF
_91
942 _2udc
_cEM
999 _c81433
_d81433
952 _40
_eInternet
_00
_bLIPS
_10
_oElectronic media
_d2017-11-28
_70
_cE
_uftp://ftp.ips.lk/ebooks/IMF/InvestingPublicInfrastructure.pdf
_yEM
_aLIPS