Infrastructure has become Cool

Ken Rogoff has a new column up, advising policy makers to focus on infrastructure;

“But the risks are two-sided, and sound economic policy is just as much about capitalizing on good times as avoiding bad ones. Economic gurus at places like the World Bank have developed a ridiculously long list of steps that countries should take to raise their growth rates (the so-called “extended Washington Consensus”). Like maintaining good health, it is not enough to concentrate on a single component. But if there is one area where obvious opportunities exist, and where policy can really make a difference, it would have to be infrastructure investment…..

But there are ways to waste less. Transparency in procurement works wonders. So, too, does private sector involvement. The Nobel laureate economist William Vickrey argued tirelessly in favor of privately financed toll roads. Private oversight can often produce better and more efficient construction, and, in theory, toll roads help alleviate traffic congestion. (Ironically, Vickery died while sitting in a traffic jam.) Even China, which has added more than 50,000 kilometers of roads and dozens of airports over the past five years, makes use of private financing….”

As Rogoff is rumored to be a candidate to replace Anne Krueger, Deputy Managing Director at IMF, it is well worth listening to him.

Related Links:

-Open Letter to Stiglitz – which has become something of a classic. See the actual debate between Stiglitz and Rogoff. See also his interview.

- Rogoff's publications while he was at the Fund and his recent columns.

- Infrastructure Lessons – World Bank publication

- Pablo has got lot of interesting posts on infrastructure

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This page contains a single entry by Paul published on April 27, 2006 12:24 AM.

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