ASi" kUCTURE FlOR DEVELOPMENT

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nearly every sector, and transport is an input for
Fix11u blidnfradure investment., every commodity. Users demand infrastructure ser-
-ratiniifb?ithtotalnd;pubhc
vices not only for direct consumption but also for
investment -n - v0l;fpixijcountnes. ¾ raising their productivity by, for instance, reducing
5i^ W : . - thle time and effort needed to secure safe water, to
~J~* -m 1Fq bring > K crops > to market, or to commute to work.
Pe-rentage of inivestnentallocated r a.- Much research in recent years has been devoted
8ivshnet octe,vsmns(o .) an tde tepigt
to.infrastructur e h +- P+S"-to estimating the productivity of infrastructure in-
S;t-->W;Xffi^s;=l;^e= 4S-j- - < :ttt--link aggregate infrastructue spending to growth of
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- -} a; W ^ GDP show very high returns in a time-series analysis.
Some cross-national studies of economic growth
and infrastructure-notably, one using public in-
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, vestments in transport and communications and anz
-t ¼ e < r -__ ^ ^ ; 2 a - other using capital stocks in roads, railways, and
-> * .- , ; i i telephones-also show that infrastructure variables
are positively and significantly correlated with
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-X.- . --.'... growth in developing.countries. In both types of
studies, h y [ - however, whether infrastructure investm
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- ment - . causes - - 0 . growth . . or growth causes infrastructure
investment is not fullv established. Moreover, there
ID. : may : . be j other , -;! factors driving the growth of both
-GDP and infastrcture that are not fully accounted
Neither the- time-series nor the cross-sectional
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