Download lec5-03

Global Infrastructure Stocks:
World Bank ‘Canning’ Paper
H. Scott Matthews
January 29, 2003
Recap of Last Lecture
 Everything
we build eventually becomes
obsolete
 Due
to many factors (tech, society, etc)
 Thus, we need to plan for that
 Difference
 Service
between physical/service life
life defined by expected obsol.
Before the Paper..
 Recent
data from the World Bank…
 Significant infrastructure differences
Indicator
Daily newspapers (per 1,000 people) (1991/ 1997 )
International outgoing telephone traffic (min per
subscriber)
Mobile phones (per 1,000 people)
Radios (per 1,000 people) (1998/ 1998 )
Avg, cost of local phone call (US$ per 3 mins.)
Telephone mainlines (per 1,000 people)
Telephone mainlines, waiting time (years)
Television sets (per 1,000 people)
Source: World Development Indicators Da tabase
Developing Developed
(High
Income)
49.3
284.7
99.8
230.5
45.9
257.7
0.1
80.9
2.0
183.2
533.9
1,267.3
0.1
596.8
0.0
669.1
Expectations
 So
we don’t lose sight of global
relevance of these issues..
 Data on previous slide implies WHAT?
 Expect
less economic output
 Lower educational levels
 Cause or effect?
Canning Paper
 “A Database
of World Infrastructure
Stocks, 1950–95”, David Canning,
World Bank Paper #1929, June 1998
 Main stock dataset available on web
 152 countries, generally 45 yrs
 Some
countries no data until recently
 What is/is not included in data?
Measures in Dataset

Roads, Paved Roads (km)
 Railway lines (km)
 Number of telephones
 Number of telephone main lines
 KW electricity generating capacity
 Some infrastructure quality measures


Condition of roads, Percent dropped calls,
electricity system losses
What could this data be used for?
Sample Data - Electricity
 US
capacity 80 TW 1950
 700
 World
TW 1995 (~10x increase)
capacity 200 -> 2500
 So what?
 Do these numbers tell us anything
important?
 What kind of values would we want
instead?
Canning Paper

Econometric study of infrastructure stocks as
related to:



Economic growth
Population Change
Investment

‘Full report’ available on web:

http://www.worldbank.org/html/dec/Publications/
Workpapers/WPS1900series/wps1929/wps1929abstract.html (bottom of this page)
Conclusions

Non-transportation infrastructure stocks tend
to increase 1:1 with population


Geographic factors appear to affect provision
of non-trans in poor countries


But not in rich countries
Transport. Infras. Increases less than 1:1 with
population


Increase more than 1:1 with per-cap GDP
Increases with income only after threshold
reached
Do these conclusions surprise us?