In the framework of approaches to assessing the impact of public capital on economic growth, this paper estimates the dynamic effects of public infrastructure for the regions of Spain using a structural vector autoregressive (S-VAR) method. Methodologically, the main contribution is the proposal of a novel form (through bi-regional models) of estimating the spillover effects of one-time innovations in the public capital installed in a given region on the economic growth of the other regions of the country. From a policy perspective, the results highlight how these new models could contribute to the allocation of public investment in order to promote balanced regional growth, and provide new insights into the analysis of regional economic growth processes.
- Public Capital
ASJC Scopus subject areas
- Geography, Planning and Development
- Urban Studies
- Economics and Econometrics