A copy of this work was available on the public web and has been preserved in the Wayback Machine. The capture dates from 2003; you can also visit the original URL.
The file type is
Policy Research Working Papers
The cost of public investment is not the value of public capital. Unlike with private investors, there is no plausible behavioral model in which every dollar that the public sector spends as "investment" creates capital in an economic sense. While this simple analytic point is obvious, it has so far been uniformly ignored in the empirical literature on economic growth which uses, at best, cumulated, depreciated, investment effort (CUDIE) to estimate capital stocks. However, particularly fordoi:10.1596/1813-9450-2341 fatcat:vlwsbiy3lzbyvnmzwr3m4wkp4e