Infrastructure investment and employment: Evidence for Portugal

2021 ◽  
Vol 5 (2) ◽  
pp. 1377
Author(s):  
Alfredo M. Pereira ◽  
Rui M. Pereira ◽  
Pedro G. Rodrigues
Keyword(s):  
Infrastructure Investment ◽  
Supply Side ◽  
Long Term Effects ◽  
Demand And Supply ◽  
Vector Autoregressive ◽  
Employment Effects ◽  
Long Run ◽  
Short Run ◽  
Infrastructure Investments

We estimated how investment in 12 infrastructure types affects employment in Portugal. Using a vector-autoregressive specification at the industry level, we found a double dividend associated with ports and airports: investing in either delivers the greatest bang per euro, both on impact and in the long run. One million euros invested in ports and airports creates 717.1 and 290.5 jobs in the long run, respectively, and 535 and 253.3 jobs in the short run, respectively. Regarding long-term employment effects, these are followed by municipal roads, telecommunications, national roads, health structures, education facilities, refineries, railroads, and highways. Water infrastructures and electricity and gas infrastructures have negligible effects. With the long-term effects decomposed, sizable supply-side employment effects for health and education facilities exist, while demand-side effects dominate for airports, ports, municipal roads, and telecommunications. Employment following the investment in national roads is balanced across demand and supply channels. We found no significant employment-related location effects of infrastructure investments. Also, investing in either health facilities or in education buildings entails non-negligible job losses in the short run. These results suggest that the magnitude and the timing of job creation crucially depend on the type of infrastructure investment. Policymakers in Portugal need to be aware of this in choosing between countercyclical or structural targets.

scholarly journals Identifying Priorities in Infrastructure Investment in Portugal

2017 ◽  
Vol 3 (3) ◽  
pp. 367
Author(s):  
Alfredo Marvão Pereira ◽  
Rui Marvão Pereira
Keyword(s):  
Infrastructure Investment ◽  
Tax Rates ◽  
Social Infrastructure ◽  
Long Term Effects ◽  
Road Transportation ◽  
Data Set ◽  
Vector Autoregressive ◽  
Transportation Infrastructures ◽  
Infrastructure Investments

<p><em>In this paper we use a vector autoregressive approach to analyze the effects of infrastructure investment on economic performance using a newly developed data set for Portugal. </em><em>Our overall goal is to identify priorities in infrastructure investments, i.e., areas of infrastructures investments with virtuous economic and budgetary effects. </em><em>We find that investments in other transportation infrastructures—railroads, ports and airports—and social infrastructures—health and education infrastructures—have the largest effects with long-term multipliers of 15.00 and 8.45, respectively. Investments in road transportation—roads and freeways—and on utilities—electricity, gas, water, refineries, and telecommunications—induce much smaller effects with multipliers of 2.75 and 3.52, respectively. We also show that for other transportation and social infrastructure investments, the short-term effects are small relative to the accumulated effects and yet, in absolute terms, they exceed the long-term effects for road transportation and utilities. Finally, we show that investments in other infrastructures and in social infrastructures will pay for themselves in the form of long-term enhanced tax revenues under rather reasonable effective tax rates. Overall, we have clearly identified other transportation infrastructures and social infrastructures as the key target areas for policy intervention in this context.</em></p>

scholarly journals Crop Production, Livestock Production and Economic Growth in Botswana (1990-2017): An Application of ARDL Model

2021 ◽  
Vol 9 (8) ◽  
pp. 1500-1508
Author(s):  
Mufaro Andrew Matandare ◽  
Patricia Masego Makepe ◽  
Lekgatlhamang Setlhare ◽  
Jonah Bajaki Tlhalefang
Keyword(s):  
Economic Growth ◽  
Crop Production ◽  
Agricultural Sector ◽  
Livestock Production ◽  
Long Term Effects ◽  
Bounds Testing ◽  
Long Run ◽  
Short Run ◽  
Testing Approach

There are few studies in Botswana which have examined the relationship between agriculture and economic growth. The uniqueness of this study is grounded in investigating disintegrated agriculture components into crop production and livestock production and investigating their nexus with economic growth. This study estimated the short and long term effects between crop production, livestock production and economic growth in Botswana for the period 1990 to 2017. The Auto-Regressive Distributed Lagged (ARDL) bounds testing approach was employed to investigate the stated relationship. Study findings from the ARDL bound testing approach confirm evidence of a long-run equilibrium relationship between crop production, livestock production and economic growth. Results indicated that livestock production has a positive and significant impact on economic growth both in the short run and long run. On the other hand crop production has a positive and significant impact on economic growth only in the long run. Efforts towards supporting agricultural sector growth should be emphasized to promote agricultural sector productivity in a bid to forge a move away from dependence on imports of food in Botswana. To enhance economic growth, in both the short run and long run, the government of Botswana and all relevant stakeholders should invest in and promote livestock production. In the long term, policies that foster crop production are essential for economic growth.

Modeling the Long-Run Learning Impact of the COVID-19 Learning Shock: Actions to (More Than) Mitigate Loss

2020 ◽  
Author(s):  
Michelle Kaffenberger
Keyword(s):  
School Closure ◽  
Mitigation Strategies ◽  
Return To School ◽  
Long Term Effects ◽  
Education Systems ◽  
School Closures ◽  
Long Run ◽  
Short Run ◽  
Catch Up

The COVID-19 pandemic has forced 1.7 billion children out of school temporarily. While many education systems are attempting varying degrees of remote learning, it is widely accepted that the closures will produce substantial losses in learning (World Bank, 2020; Kuhfeld et al., 2020). However, the real concern is not just that a few months of learning will be lost in the short run, but that these losses will accumulate into large and permanent learning losses as many children fall behind during school closures and never catch up. This note uses a calibrated model with a “pedagogical production function” (Kaffenberger and Pritchett, 2020) to estimate the potential long-term losses to children’s learning from the temporary shock of school closures. The model shows that without mitigation, children could lose more than a year’s worth of learning even from a three-month school closure as the short-term losses continue to compound after children return to school. Turning to mitigation strategies, the note examines the long-term effects of two strategies, finding that with some mitigation efforts education systems could come back from the crisis stronger than before.

Long-term effects of population growth on aggregate investment dynamics

2015 ◽  
Vol 6 (3) ◽  
pp. 225-250 ◽  
Author(s):  
Simplice A. Asongu
Keyword(s):  
Population Growth ◽  
Public Investment ◽  
Private Investment ◽  
Domestic Investment ◽  
Long Term Effects ◽  
Content Type ◽  
Vector Autoregressive ◽  
Long Run ◽  
Investment Dynamics

Purpose – The generation is witnessing the greatest demographic transition and Africa is at the heart of it. There is mounting concern over corresponding rising unemployment and depleting per capita income. The purpose of this paper is to examine the issues from a long-run perspective by assessing the relationships between population growth and a plethora of investment dynamics: public, private, foreign and domestic investments. Design/methodology/approach – Vector autoregressive models in the perspectives of vector error correction and short-run Granger causality are used. Findings – In the long-run population growth will: first, decrease foreign and public investments in Ivory Coast; second, increase public and private investments in Swaziland; three, deplete public investment but augment domestic investment in Zambia; fourth diminish private investment and improve domestic investment in the Congo Republic and Sudan, respectively. Practical implications – Mainstream positive linkage of population growth to investment growth in the long-term should be treated with extreme caution. Policy orientation should not be blanket, but contingent on country-specific trends and tailored differently across countries. The findings stress the need for the creation of a conducive investment climate (and ease of doing business) for private and foreign investments. Family planning and birth control policies could also be considered in countries with little future investment avenues. Originality/value – The objective of this study is to provide policy makers with some insights on how future investment opportunities could help manage rising population growth and corresponding unemployment.

scholarly journals The role of personal income tax reforms in the transition to a democratic and egalitarian Egypt

2012 ◽  
Vol 9 (2) ◽  
pp. 385-399
Author(s):  
Monal A. Abdel-Baki ◽  
Nirmala Dorasamy
Keyword(s):  
Income Tax ◽  
Personal Income ◽  
Personal Income Tax ◽  
Long Term Effects ◽  
Important Lesson ◽  
Tax Reforms ◽  
Vector Autoregressive ◽  
Short Run ◽  
Structural Vector Autoregressive Model

The efficacy of the 2005-Personal Income Tax (PIT) reform in enhancing the macroeconomic performance in Egypt is tested using a structural vector autoregressive model. The results reveal that PIT reforms have successfully generated jobs and accelerated GDP growth. The reforms may cause mild inflation in the short-run, but their long-term effects are non-inflationary. This is the first effort to assess the PIT reforms in Egypt, with the aim of helping the new government to assess preceding policies and pursue the successful ones. The research is also an important lesson for the leaders of emerging economies encountering similar circumstances to enact reforms and to perpetuate economic growth and sociopolitical stability.

scholarly journals A Literature Review on the Impacts of Armed Conflicts on Human Development

2021 ◽  
Author(s):  
Hoang T. T. Huong ◽  
Nguyen K. Hang ◽  
Le T. Trang ◽  
Nguyen D. Khoi ◽  
Le Kien ◽  
...  
Keyword(s):  
Literature Review ◽  
Human Development ◽  
Armed Conflicts ◽  
Negative Consequences ◽  
Long Term Effects ◽  
Negative Effects ◽  
Short Term ◽  
Long Run ◽  
Short Run

This paper reviews the literature for both the short-term and long-term effects of armed conflicts on human development. We identify the negative effects of exposure to armed conflicts on child health in the short run, and prospective earnings, educational attainment, labor productivity in the long run. The findings call for quick and effective actions to minimize the negative consequences of armed conflicts in both the short run and long run.

scholarly journals The role of personal income tax reforms in the transition to a democratic and egalitarian Egypt

2012 ◽  
Vol 1 (3) ◽  
pp. 74-88
Author(s):  
Monal Abdel-Baki ◽  
Nirmala Dorasamy
Keyword(s):  
Income Tax ◽  
Personal Income ◽  
Personal Income Tax ◽  
Long Term Effects ◽  
Important Lesson ◽  
Tax Reforms ◽  
Vector Autoregressive ◽  
Short Run ◽  
Structural Vector Autoregressive Model

The efficacy of the 2005-Personal Income Tax (PIT) reform in enhancing the macroeconomic performance in Egypt is tested using a structural vector autoregressive model. The results reveal that PIT reforms have successfully generated jobs and accelerated GDP growth. The reforms may cause mild inflation in the short-run, but their long-term effects are non-inflationary. This is the first effort to assess the PIT reforms in Egypt, with the aim of helping the new government to assess preceding policies and pursue the successful ones. The research is also an important lesson for the leaders of emerging economies encountering similar circumstances to enact reforms and to perpetuate economic growth and sociopolitical stability.

scholarly journals Are all infrastructure investments created equal? The case of Portugal

2018 ◽  
Vol 2 (1) ◽  
pp. 67
Author(s):  
Alfredo M. Pereira ◽  
Rui M. Pereira
Keyword(s):  
Private Investment ◽  
Economic Effects ◽  
Infrastructure Investment ◽  
Data Set ◽  
Vector Autoregressive ◽  
The Public ◽  
Infrastructure Investments ◽  
Marginal Returns ◽  
The Impact

Using a newly developed data set, we analyze the effects of infrastructure investment on economic performance in Portugal. A vector-autoregressive approach estimates the elasticity and marginal products of twelve types of infrastructure investment on private investment, employment, and output. We find that the largest long-term accumulated effects come from investments in railroads, ports, airports, health, education, and telecommunications. For these infrastructures, the output multipliers suggest that these investments pay for themselves through additional tax revenues. For investments in ports, airports and education infrastructures, the bulk of the effects are short-term demand-side effects, while for railroads, health, and telecommunications, the impact is mostly of a long-term and supply-side nature. Finally, investments in health and airports exhibit decreasing marginal returns, with railroads, ports, and telecommunications being relatively stable. In terms of the other infrastructure assets, the economic effects of investments in municipal roads, electricity and gas, and refineries are insignificant, while investments in national roads, highways, and waste and waste water have positive economic effects but too small to improve the public budget. Clearly, from a policy perspective, not all infrastructure investments in Portugal are created equal.

scholarly journals Short-Term and Long-Term Effect of Firms’ IPO on Competitors’ Performance

2020 ◽  
Vol 2 (1) ◽  
pp. 1-1
Author(s):  
Nadia Marcha Chintya ◽  
Nadya Theodora ◽  
Vania Evelyn ◽  
Adrian Teja
Keyword(s):  
Stock Returns ◽  
Initial Public Offering ◽  
Long Term Effects ◽  
Short Term ◽  
Cross Sectional ◽  
Stock Performance ◽  
Long Run ◽  
Negative Effect ◽  
Short Run

This study provides empirical evidence on the short term and the long term effects of initial public offering (IPOs) by firms, on their competitor firms’ performance in Indonesia. We perform short-run and long-run event studies and cross sectional regressions over the period 2010 to 2017 and find that both IPO firms and their competitors experience positive stock returns in the short-run and in the long-run. We find that IPO firms’ stock performance is relatively stable in the long-run that enables the competitor firms’ stock returns to catch up with IPO firms’ stock performance. We find negative effect of IPO firms’ stock performance on their competitors’ stock performance in the short-run, and a positive effect in the long-run. Our findings imply that IPO firms provide good information to the industry and no obvious competitive landscape changes are observed.

Where Did All the Dollars Go? The Effect of Cash Flows on Capital and Asset Structure

2011 ◽  
Vol 46 (5) ◽  
pp. 1259-1294 ◽  
Author(s):  
Sudipto Dasgupta ◽  
Thomas H. Noe ◽  
Zhen Wang
Keyword(s):  
Cash Flow ◽  
Economic Effect ◽  
Balance Sheet ◽  
Cash Flows ◽  
Long Run ◽  
Goods Market ◽  
Short Run ◽  
Debt Market ◽  
Short And Long Term

AbstractThis paper documents the short- and long-term balance sheet effect of cash flows. We show that cash savings in the short run and debt reduction in both the short and the long run account for a substantial fraction of cash flow use. Although, in the long run, investment exhibits substantial sensitivity to cash flows, investment does not absorb the entire cash flow shock. In fact, the tighter the financial constraints, the smaller the fraction of cash flow absorbed by investment and the more by leverage reduction. Firms stage their response to increases in cash flow, delaying investment while building up cash stocks and reducing leverage. These results suggest that much of the short-run economic effect of cash flow shocks to the corporate sector may be channeled into the corporate debt market rather than the capital goods market, especially when financing constraints tighten.

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