The Dynamics of Domestic and International infrastructure Investments

This article presents an analysis of the impact of infrastructure policies on the welfare of different countries. The author uses a model of dynamic competition among countries, focusing on optimal investment policies in two situations: when coordination among countries is reached versus when countries behave egoistically. The author describes the optimal path of investment as characterized by an initial improvement of domestic infrastructure and then a balanced investment in both domestic and international infrastructure. The author concludes that because international infrastructure produces positive externalities, the second situation (behaving egoistically and less cooperatively) offers sub-optimal results for all parties involved.


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  • Accession Number: 01531951
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Jul 9 2014 9:58AM