Download or read book The Quality of Public Investment written by Shankha Chakraborty and published by International Monetary Fund. This book was released on 2009-07 with total page 26 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper presents a simultaneous assessment of the relationship between economic performance and three groups of economic reforms: domestic finance, trade, and the capital account. Among these, domestic financial reforms, and trade reforms, are robustly associated with economic growth, but only in middle-income countries. In contrast, we do not find any systematic positive relationship between capital account liberalization and economic growth. Moreover, the effect of domestic financial reforms on economic growth in middle-income countries is explained by improvements in measured aggregate TFP growth, not by higher aggregate investment. We present evidence that variation in the quality of property rights helps explain the heterogeneity of the effectiveness of financial and trade reforms in developing countries. The evidence suggests that sufficiently developed property rights are a precondition for reaping the benefits of economic reform. Our results are robust to endogeneity bias and a number of alternative specifications.

Download or read book OECD Public Governance Reviews Integrity Framework for Public Investment written by OECD and published by OECD Publishing. This book was released on 2016-02-29 with total page 95 pages. Available in PDF, EPUB and Kindle. Book excerpt: Public investment, and particularly infrastructure investment, is important for sustainable economic growth and development as well as public service provision. However, it is also vulnerable to capture and corruption.

Download or read book The Power of Public Investment Management written by Kai Kaiser and published by World Bank Publications. This book was released on 2014-10-17 with total page 203 pages. Available in PDF, EPUB and Kindle. Book excerpt: Public resources--if invested well in public infrastructure and services--can catalyze private and community e orts and unleash an inclusive growth and development process. But too often public projects are selectedto support political patronage, poorly designed, underfunded, long delayed, very costly, or badly implemented, with little bene t to the population. This is a critical challenge for many countries, both rich and poor. This book identi es eight key institutional features that countries need to adopt to ensure that public investments support growth and development. The Power of Public Investment Management provides a clear, nontechnical discussion on approaches to improving project appraisal, disciplining political intervention in project selection, dealing with uncertainty (an issue that is likely to grow in importance with the e ects of climate change), integrating procurement skills into project design and implementation, and managing the decision on public-private partnerships. Byproviding a simple but comprehensive framework and global experience, the book provides policy makers the guidance to adopt good functional principles in the design of institutions to strengthen public investment management.

Download or read book Improving Public Investment Efficiency in the G 20 written by International Monetary Fund. Fiscal Affairs Dept. and published by International Monetary Fund. This book was released on 2015-01-09 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt: Through the provision of both social and economic infrastructure, public investment can serve as an important catalyst for economic growth. A significant body of theoretical and empirical research underscores the positive relationship between investment in high-quality public infrastructure and economy-wide productivity.1 Against the background of a steady decline in public investment as a share of GDP in advanced economies, evidence of infrastructure bottlenecks in emerging economies, and the sluggish global economic recovery, the G-20 has called for ramping up public investment to raise long-run economic growth (G-20, 2014).2 However, the economic and social impact of public investment crucially depends on its efficiency. Despite anecdotal evidence of projects plagued by time delays, cost overruns, and inadequate maintenance, there are few robust empirical studies of the determinants of public investment efficiency. This paper explores the link between public investment management (PIM) institutions and the efficiency of public investment for the G-20 countries. Based on the analysis from a recent IMF study, the paper finds that better PIM enhances public infrastructure quality, and pinpoints key institutional reforms needs to boost public investment efficiency (IMF 2015). These findings and recommendations are based on a comprehensive data set on investment, infrastructure and capital stocks, and two analytical innovations: (i) a new cross-country Public Investment Efficiency Index (PIE-X); and (ii) a new Public Investment Management Assessment (PIMA) which is applied to G-20 countries.

Download or read book Making Public Investment More Efficient written by and published by INTERNATIONAL MONETARY FUND. This book was released on 2015-01-05 with total page 68 pages. Available in PDF, EPUB and Kindle. Book excerpt: Public investment supports the delivery of key public services, connects citizens and firms to economic opportunities, and can serve as an important catalyst for economic growth. After three decades of decline, public investment has begun to recover as a share of GDP in emerging markets (EMs) and low income developing countries (LIDCs), but remains at historic lows in advanced economies (AEs). The increase in public investment in EMs and LIDCs has led to some convergence between richer and poorer countries in the quality of and access to social infrastructure (e.g., schools and hospitals), and, to a lesser extent, economic infrastructure (e.g., roads and electricity). However, the economic and social impact of public investment critically depends on its efficiency. Comparing the value of public capital (input) and measures of infrastructure coverage and quality (output) across countries reveals average inefficiencies in public investment processes of around 30 percent. The economic dividends from closing this efficiency gap are substantial: the most efficient public investors get twice the growth “bang” for their public investment “buck” than the least efficient.

Download or read book Investing in Public Investment written by Mr.Chris Papageorgiou and published by International Monetary Fund. This book was released on 2011-02-01 with total page 46 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper introduces a new index that captures the institutional environment underpinning public investment management across four different stages: project appraisal, selection, implementation, and evaluation. Covering 71 countries, including 40 low-income countries, the index allows for benchmarking across regions and country groups and for nuanced policy-relevant analysis and identification of specific areas where reform efforts could be prioritized. Potential research venues are outlined.

Download or read book The Macroeconomic Effects of Public Investment written by Mr.Abdul Abiad and published by International Monetary Fund. This book was released on 2015-05-04 with total page 26 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper provides new evidence of the macroeconomic effects of public investment in advanced economies. Using public investment forecast errors to identify the causal effect of government investment in a sample of 17 OECD economies since 1985 and model simulations, the paper finds that increased public investment raises output, both in the short term and in the long term, crowds in private investment, and reduces unemployment. Several factors shape the macroeconomic effects of public investment. When there is economic slack and monetary accommodation, demand effects are stronger, and the public-debt-to-GDP ratio may actually decline. Public investment is also more effective in boosting output in countries with higher public investment efficiency and when it is financed by issuing debt.

Download or read book Corruption Public Investment and Growth written by Mr.Hamid Reza Davoodi and published by International Monetary Fund. This book was released on 1997-10-01 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: Corruption, particularly political or “grand” corruption, distorts the entire decision-making process connected with public investment projects. The degree of distortions is higher with weaker auditing institutions. The evidence presented shows that higher corruption is associated with (i) higher public investment; (ii) lower government revenues; (iii) lower expenditures on operations and maintenance; and (iv) lower quality of public infrastructure. The evidence also shows that corruption increases public investment while reducing its productivity. These are five channels through which corruption lowers growth. An implication is that economists should be more restrained in their praise of high public sector investment, especially in countries with high corruption.

Download or read book Some Misconceptions about Public Investment Efficiency and Growth written by Mr.Andrew Berg and published by International Monetary Fund. This book was released on 2015-12-23 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: We reconsider the macroeconomic implications of public investment efficiency, defined as the ratio between the actual increment to public capital and the amount spent. We show that, in a simple and standard model, increases in public investment spending in inefficient countries do not have a lower impact on growth than in efficient countries, a result confirmed in a simple cross-country regression. This apparently counter-intuitive result, which contrasts with Pritchett (2000) and recent policy analyses, follows directly from the standard assumption that the marginal product of public capital declines with the capital/output ratio. The implication is that efficiency and scarcity of public capital are likely to be inversely related across countries. It follows that both efficiency and the rate of return need to be considered together in assessing the impact of increases in investment, and blanket recommendations against increased public investment spending in inefficient countries need to be reconsidered. Changes in efficiency, in contrast, have direct and potentially powerful impacts on growth: “investing in investing” through structural reforms that increase efficiency, for example, can have very high rates of return.

Download or read book Scaling Up Quality Infrastructure Investment written by International Monetary Fund and published by International Monetary Fund. This book was released on 2021-04-30 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: South Asia needs large infrastructure investments to achieve its development goals, and public investment can also support the Covid-19 recovery. Regression estimates that account for the quantity and quality of investment suggest that public infrastructure was a key driver of productivity growth in South Asia. Going forward, higher public infrastructure spending can raise growth, but its benefits depend on how it is financed and managed. Model simulations show that tax financing, concessional lending, or private sector financing through public private partnerships (PPPs) are more advantageous than government borrowing through financial markets because they support growth while containing the impact on public debt. However, the optimal choice also depends on available fiscal space, taxation capacity, implementation risks, and public investment efficiency. To reap the most benefits from higher infrastructure investment, South Asian countries need to manage fiscal risks carefully, including from PPPs and state-owned enterprises, and improve public investment efficiency.

Download or read book Public Investment as an Engine of Growth written by Mr.Andrew M. Warner and published by International Monetary Fund. This book was released on 2014-08-11 with total page 76 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper looks at the empirical record whether big infrastructure and public capital drives have succeeded in accelerating economic growth in low-income countries. It looks at big long-lasting drives in public capital spending, as these were arguably clear and exogenous policy decisions. On average the evidence shows only a weak positive association between investment spending and growth and only in the same year, as lagged impacts are not significant. Furthermore, there is little evidence of long term positive impacts. Some individual countries may be exceptions to this general result, as for example Ethiopia in recent years, as high public investment has coincided with high GDP growth, but it is probably too early to draw definitive conclusions. The fact that the positive association is largely instantaneous argues for the importance of either reverse causality, as capital spending tends to be cut in slumps and increased in booms, or Keynesian demand effects, as spending boosts output in the short run. It argues against the importance of long term productivity effects, as these are triggered by the completed investments (which take several years) and not by the mere spending on the investments. In fact a slump in growth rather than a boom has followed many public capital drives of the past. Case studies indicate that public investment drives tend eventually to be financed by borrowing and have been plagued by poor analytics at the time investment projects were chosen, incentive problems and interest-group-infested investment choices. These observations suggest that the current public investment drives will be more likely to succeed if governments do not behave as in the past, and instead take analytical issues seriously and safeguard their decision process against interests that distort public investment decisions.

Download or read book Public Investment Efficiency in Sub Saharan African Countries written by Karim Barhoumi and published by International Monetary Fund. This book was released on 2018-07-06 with total page 51 pages. Available in PDF, EPUB and Kindle. Book excerpt: There is significant room to improve public investment efficiency in sub-Saharan Africa. Investment in sub-Saharan African countries is lagging vis-à-vis peers such as emerging and developing Asia as well as Latin America and the Caribbean, and the region’s infrastructure is perceived as being of relatively low quality. Improving the efficiency of sizable investment programs in the region could contribute to more solid economic growth and help achieve desired social priorities and development goals. Results point to some variability in public investment efficiency within the region. Comparing efficiency scores across country groups suggests that investment efficiency in sub-Saharan African oil exporters tends to be lower than in sub-Saharan African non-resource-intensive countries. Additionally, countries in East African Community (EAC) perform better than those in Central African Economic and Monetary Community (CEMAC) and West African Economic and Monetary Union (WAEMU). Stronger institutions could foster more efficient public investment. The regression results in this paper show a positive correlation between public investment efficiency and the quality of institutions, suggesting that devel-oping stronger institutions in sub-Saharan Africa could lead to a significant improvement in investment efficiency. This is particularly relevant for coun-tries with weak institutional quality, where governments may use capital spending as a vehicle for rent-seeking, leading to inefficient spending. Given the current drive for scaling up investment in sub-Saharan Africa, the task of improving institutions quickly should become a priority.

Download or read book Well Spent written by Mr.Gerd Schwartz and published by International Monetary Fund. This book was released on 2020-09-03 with total page 344 pages. Available in PDF, EPUB and Kindle. Book excerpt: Drawing on the Fund’s analytical and capacity development work, including Public Investment Management Assessments (PIMAs) carried out in more than 60 countries, the new book Well Spent: How Strong Infrastructure Governance Can End Waste in Public Investment will address how countries can attain quality infrastructure outcomes through better infrastructure governance—an issue becoming increasingly important in the context of the Great Lockdown and its economic consequences. It covers critical issues such as infrastructure investment and Sustainable Development Goals, controlling corruption, managing fiscal risks, integrating planning and budgeting, and identifying best practices in project appraisal and selection. It also covers emerging areas in infrastructure governance, such as maintaining and managing public infrastructure assets and building resilience against climate change.

Download or read book Efficiency Adjusted Public Capital and Growth written by Mr.Sanjeev Gupta and published by International Monetary Fund. This book was released on 2011-09-01 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper constructs an efficiency-adjusted public capital stock series and re-examines the public capital and growth relationship for 52 developing countries. The results show that public capital is a significant contributor to economic growth. Although the estimated coefficient for the income share of public capital is larger in middle- than in low-income countries, the opposite is true for the marginal product of public capital. The quality of public investment, as measured by variables capturing the adequacy of project selection and implementation, are statistically significant in explaining variations in economic growth, a result mainly driven by low-income countries.

Download or read book Efficiency Adjusted Public Capital Capital Grants and Growth written by Ernesto Crivelli and published by International Monetary Fund. This book was released on 2017-07-25 with total page 21 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recent literature has explored the relationship between efficiency-adjusted public capital and economic growth. A debate on whether capital grants, and especially EU funds actually contribute to growth has gained prominence lately. This paper empirically assesses the relationship between the quality of public investment, capital grants, and growth in a sample of 43 emerging and peripheral economies over 1991-2015. To this end, the contribution of public capital to growth is estimated using efficiency-adjusted public capital stock series, constructed reflecting the quality of public investment management institutions. In addition, the determinants of effective public investment are analyzed. The results suggest that capital grants contribute positively to effective public investment, and the latter is significant in explaining variations in economic growth. Finally, the paper illustrates the impact of raising EU funds absorption on potential growth in emerging and peripheral EU countries.

Download or read book A European Public Investment Outlook written by Floriana Cerniglia and published by Open Book Publishers. This book was released on 2020-06-12 with total page 166 pages. Available in PDF, EPUB and Kindle. Book excerpt: This outlook provides a focused assessment of the state of public capital in the major European countries and identifies areas where public investment could contribute more to stable and sustainable growth. A European Public Investment Outlook brings together contributions from a range of international authors from diverse intellectual and professional backgrounds, providing a valuable resource for the policy-making community in Europe to feed their discussion on public investment. The volume both offers sector-specific advice and highlights larger areas which should be prioritized in the policy debate (from transport to social capital, R&D and the environment). The Outlook is structured into two parts: the chapters of Part I respectively explore public investment trends in France, Germany, Italy, Spain and Europe as a whole, and illuminate how the legacy of the 2008 Global Financial Crisis is one of insufficient public investment. Part II investigates some areas into which resources could be channelled to reverse the recent trend and provide European economies with an adequate public capital stock. The essays in this outlook collectively foster a broad approach to and definition of public investment, that is today more relevant than ever. Offering up a timely and clear case for the elimination of bias against investment in European fiscal rules, this outlook is a welcome contribution to the European debate, aimed both at policy makers and general readers.

Download or read book Public Investment Management Reference Guide written by Jay-Hyung Kim and published by World Bank Publications. This book was released on 2020-03-03 with total page 279 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Public Investment Management (PIM) Reference Guide aims to convey country experiences and good international practices as a basis for decisions on how to address a country-specific PIM reform agenda. The country references are drawn largely from previous diagnostics and technical assistance reports of the World Bank. The application of country diagnostics and assessments has revealed a need to address the following issues when undertaking a country reform in PIM: • Clarification of the definition and scope of public investment and public investment management • Establishment of a sound legal, regulatory, and institutional setting for PIM, making sure it is linked to the budget process • Allocation of roles and responsibilities for key players in PIM across government • Strengthening of guidance on project preappraisal, appraisal, and selection-prioritization procedures and deepening of project appraisal methodologies • Integration of strategic planning, project appraisal-selection, and capital budgeting • Management of multiyear capital budget allocations and commitments • Efforts to address effective implementation, procurement, and monitoring of projects • Strengthening of asset management and ex post evaluation • Integration of PIM and public-private partnership (PPP) in a unified framework • Rationalization and prioritization of the existing PIM project portfolio • Development of a PIM database and information technology in the form of a PIM information system. The PIM Reference Guide does not seek to provide definitive answers or standard guidance for the common PIM issues facing countries. Nor does it seek to provide a detailed template for replication across countries: this would be impossible given the diversity of country situations. Instead, each chapter begins with an overview of the specific reform issue, lists approaches and experiences from different countries, and summarizes the references and good practices to be considered in designing country-specific reform actions.