Infrastructure and Institutions as Part of the Economic Growth Process: Results from a Dynamic Panel Approach
This study revisits the ongoing debate on the e ect of infrastructure investment on long-run economic growth. We strongly argue that the productivity of the infrastruc-ture investment depends the institutional frameworks. This paper improves on the methodology by conducting system-GMM estimations for a panel of 221 countries. The results suggest in the countries where there is a better institutional quality there is a positive correlation between infrastructure investment and economic growth. In particular, the study show that there is a positive and robust correlation between infrastructure investment and economic growth in countries with a well established democratic system and "good" regulations.
Keywords - Infrastructure; institutions; economic growth; investment; quality.
JEL classi cation: H54, F20