Infraestructura pública y su importancia para el crecimiento económico: El caso de Oaxaca (México)
| Autor | Luis Enrique Rojas Ramírez - Alejandro Molina Vargas |
| Cargo | Facultad Latinoamericana de Ciencias Sociales, México, luis.rojas@estudiante-flacso.mx. Orcid: 0000-0003-2079-7363. - Universidad Autónoma Metropolitana, México. alejandromolin@hotmail.com. Orcid: 0000-0001-9319-4913. |
| Páginas | 5-27 |
Ecos de Economía: A Latin American Journal of Applied Economics | Vol. 22 | No. 46 | 2018
Research Article
Public infrastructure and its imPortance for
economic growth: the case of oaxaca (mexico)
Infraestructura pública y su importancia para el
crecimiento económico: El caso de Oaxaca (México)
Luis Enrique Rojas Ramíreza, Alejandro Molina Vargasb
Abstract
The objective of this paper is to estimate the impact of public infrastructure
on economic growth in the eight regions of Oaxaca for the period -.
Given that regional statistics are lacking, the methodology proposed by Gerber
() is used to calculate the economic growth of the regions. And to measure
the impact of infrastructure on growth, based on Hoechle () a fixed-eects
model with standard errors of Driscoll and Kraay (DKSE) is applied. The results
indicate that investment in infrastructure has been insuicient and misallocated;
however, the social infrastructure shows the greatest impact on growth. Finally,
the results suggest that the most dynamic regions require greater investment in
economic infrastructure, while the backward regions need social infrastructure.
Resumen
El objetivo del presente trabajo es estimar el impacto de la infraestructura pública
sobre el crecimiento económico en las ocho regiones de Oaxaca para el periodo
-. Dado que se carecen de estadísticas, se emplea la metodología pro-
puesta por Gerber () para calcular el crecimiento económico de las regiones.
Y para medir el impacto de la infraestructura en el crecimiento, con base en Hoe-
chle () se aplica un modelo de efectos fijos con errores estándar de Driscoll y
Kraay (DKSE). Los resultados indican que la inversión en infraestructura ha sido
insuficiente y mal asignada; la infraestructura social es la que muestra mayor
impacto en el crecimiento; por último, los resultados sugieren que las regiones
más dinámicas requieren de una mayor inversión en infraestructura económica,
mientras que las regiones atrasadas necesitan de infraestructura social.
Palabras clave: Datos panel,
infraestructura, crecimiento
económico regional.
Keywords: Panel data,
infrastructure, regional economic
growth.
JEL Classification: C23, H54, R11
Received: 04/04/2018
Accepted: 21/05/2018
Published: 01/06/2018
a. Facultad Latinoamericana
de Ciencias Sociales, México,
luis.rojas@estudiante-flacso.mx.
Orcid: 0000-0003-2079-7363.
b. Universidad Autónoma
Metropolitana, México.
alejandromolin@hotmail.com.
Orcid: 0000-0001-9319-4913.
ISSN 1657-4206 e-ISSN 2462-8107 Vol. 22 No. 46 PP. 4-27 DOI: 10.17230/ecos.2018.46.1
PP 6 | 114
Ecos de Economía: A Latin American Journal of Applied Economics | Vol. 22 | No. 46 | 2018
Public infrastructure and its importance for economic growth: the case of Oaxaca (Mexico)
INTRODUCTION
The southeast region of Mexico is characterized by significant social backwardness and high levels
of poverty and illiteracy (Dávila, Kessel & Levy, ), accompanied by a low level of economic grow-
th. Given the economic and social backwardness that exists in this region, Esquivel, López & Vélez
() argue that investment policies focused on human capital and infrastructure are priorities.
Public infrastructure, being a productive investment, is fundamental to stimulate the economic
dynamics of a region because it is the base on which diverse activities are supported, thus promoting
economic growth. Increased availability and a higher quality of infrastructure lead to higher factor
productivity and lower production costs (Aschauer, ). In contrast, their absence is a major obstacle
to the eective implementation of development policies and, with this, the achievement of levels of
sustainable growth (World Bank, ).
The objective of this paper is to estimate the impact of public infrastructure (social and economic)
on the economic growth of the eight regions of Oaxaca, Mexico for the period -. Consis-
tent with the characteristics and rugged topography of Oaxaca, the work suggests what types of
infrastructure are appropriate for each of the regions.
This remainder of this article is structured as follows: Section I is a review of the literature. Section
II presents the methodology proposed by Gerber () to calculate regional growth rates. Section
III estimates the impact of infrastructure on growth based on the approach used by Hoechle (),
augmented with a fixed eects model. Section IV presents the conclusions.
1. PUBLIC INFRASTRUCTURE: A REVIEW OF LITERATURE
For Aschauer () the government fulfills two functions: it collects taxes and it provides public goods
(services). The public goods are divided into consumer-oriented goods (parks, museums, etc.) and
goods dedicated to production (for example, the construction and maintenance of roads). The latter,
also considered productive goods, have a double function: they can function as intermediate inputs
or as final inputs. In the literature (Aschauer, ; Aschauer, ; Munnell, a; Fuentes, ;
Noriega & Fontenla, ; Hernández, , ), there is a consensus that public infrastructure is
a factor that explains long-run economic growth.
1.1. Types of infrastructure
There is no widely-accepted definition of public infrastructure. For Hirschman () it includes those
basic services without which there could be no primary, secondary and tertiary productive activities.
In its broadest sense it includes all public services, from education and public health to transport,
communications and the supply of energy and water. It is a set of public assets that generates an
environment where social interaction and economic processes take place (Piedras, ). According to
Diamond (), infrastructure has three basic characteristics: (a) it is a collective input; (b) it includes
investments in both physical capital and human capital; and (c) it is integrative; the components are
integrated through telecommunications networks, transport, and transactions.
Because of its characteristics and functions, public infrastructure is a good that is not normally
supplied by the market or that only supplies it ineiciently, so that its provision is fundamentally
determined by political decisions (Biehl, ). Fuentes () mentions that infrastructure can be
classified into three categories: material (or physical), institutional, and personal. The first element is
understood as the stock of public capital (roads, water dams, schools, etc.) produced and administered
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