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PUBLIC CAPITAL, REGIONAL OUTPUT, AND DEVELOPMENT: SOME EMPIRICAL EVIDENCE
Author(s) -
Costa Jose da Silva,
Ellson Richard W.,
Martin Randolph C.
Publication year - 1987
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/j.1467-9787.1987.tb01171.x
Subject(s) - public capital , economics , capital (architecture) , production (economics) , homogeneity (statistics) , production function , means of production , econometrics , physical capital , public economics , microeconomics , financial capital , human capital , economic growth , mathematics , geography , statistics , archaeology , public investment , profit (economics)
The goal of our paper is to provide direct estimates of the association between public capital and regional output. This is made possible by the construction of a data series which measures public capital at the state level. The relation between public capital and other productive factors is tested using a translog production function. Our results show that labor and public capital are complementary inputs, and that public capital exhibited diminishing returns. We also consider restrictions on the translog formulation. Linear homogeneity is rejected in all cases, and the Cobb‐Douglas specification is rejected for the manufacturing and all sectors categories.