The Contribution of Publicly Provided Inputs to States' Economies, Regional Science and Urban Economics
We specify a regional production function that, in addition to labor and private capital, includes two publicly provided inputs highways and education. We employ a panel data set consisting of annual observations on the 48 contiguous states from 1969 to 1983 to estimate input elasticity coefficients under a specification that allows for differences over time and across states. We find that both of the publicly provided inputs have a significant and positive effect on output. Our results support the policy conclusion that publicly provided infrastructure is an important element of economic growth.
Therese J. McGuire, Teresa Garcia-Mila
McGuire, J. Therese, and Teresa Garcia-Mila. 1992. The Contribution of Publicly Provided Inputs to States' Economies. Regional Science and Urban Economics. 22(2): 229-241.