Infrastructure Investment for Poverty Reduction: A Survey of Key Issues
The links between infrastructure investments and economic growth
and between growth and the incomes and welfare of the poor have often been studied in separate strands of the econometric literature. Broadly speaking there is an understanding of a positive relationship between infrastructure investment and growth and of growth typically being associated with falling poverty. This is unlikely to be a simple unidirectional set of relations as feedback between higher income and the demand for infrastructure services and between poverty and inequality and growth are possible and must be allowed for in any rigorous model specification. Infrastructure’s relations with the poor can be seen in both direct terms—through changes in distribution—and indirect through the wider growth effects and higher economic activity stimulated by
infrastructure.
This Research Policy Brief surveys the key issues in infrastructure investment for poverty reduction.
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The views expressed in this paper are the views of the authors and do not necessarily reflect the views or policies of the Asian Development Bank Institute (ADBI), the Asian Development Bank (ADB), its Board of Directors, or the governments they represent. ADBI does not guarantee the accuracy of the data included in this paper and accepts no responsibility for any consequences of their use. Terminology used may not necessarily be consistent with ADB official terms.
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