Measuring the Impact of Debt-Financed Public Investment

Cavalcanti, Carlos B. ; Marrero, Gustavo A. ; Le, Tuan Minh

World Bank, Washington, DC

关键词: ACCESS TO FINANCING;    ACCOUNTING;    ADMINISTRATIVE CAPACITY;    AFFILIATED ORGANIZATIONS;    ARBITRAGE;   

DOI  :  10.1596/1813-9450-6766
RP-ID  :  WPS6766

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

While debt-financed productive publicinvestment raises a country s debt ratios in the short run,it can also generate higher growth, revenues, and exports,leading over time to lower debt ratios. This paper developsa framework to assess whether countries meet the conditionsfor realizing the net benefits over the costs of publicinvestment debt financing. While it is possible to achievedebt sustainability with an appropriate mix of concessionaland non-concessional financing, this is a necessary but notsufficient condition. It is also important to ensure theoperational viability of public investment projects byhaving in place adequate project management: (i) projectscreening and appraisal, (ii) a clear connection betweencapital and recurrent expenditures once the projects arelaunched, and (iii) safeguards for appropriate projectimplementation and facilities operations. To illustrate thestrength of these results, the paper carries out threemeasurement exercises: (a) a simulation of the degree towhich the ratio of optimal public investment responds tochanges in key parameters related to project management in ageneral equilibrium model; (b) application of the publicinvestment management (PIMa) index to benchmark acountry's public investment management capacity; and(c) presentation of the results of the Investment, Savings,and Macroeconomic Vulnerabilities tool aimed at trackingcountry choices in public finance and the impact of publicprojects on private investments.