In recent years, there has been an increasing interest in the fact that publiccapital, or public infrastructure, plays a crucial role in determining economic growthin low-income countries. This thesis studies the links among public capital, economicdevelopment, and growth, using overlapping generations (OLG) models. Chapter 1 develops a three-period, gender-based overlapping generations modelof endogenous growth with endogenous intra-household bargaining and child labourin home production by girls. Improved access to infrastructure reduces the amount oftime parents fi…nd optimal for their daughters to spend on household chores, therebyallowing them to allocate more time to studying at home. The model is calibratedfor a low-income country and various quantitative experiments are conducted. Thisincludes an increase in the share of public spending on infrastructure, an increase intime allocated by mothers to their daughters, and a decrease in fathers’' preferencefor their daughters' ’education. Our analysis shows that poor access by families toinfrastructure may provide an endogenous explanation, beyond social norms andcultural values, for the persistence of child labour at home and gender inequality inlow-income countries. In Chapter 2, the link between infrastructure and industrial development is stud-ied in an OLG model with endogenous skill acquisition. Industrial developmentis defi…ned as a shift from an imitation-based, low-skill economy to an innovation-based, high-skill economy where ideas are produced domestically. Imitation gen-erates knowledge spillovers, which enhance productivity in innovation. Changes inindustrial structure are measured by the ratio of the variety of imitation-based toinnovation-based intermediate goods. The model also distinguishes between basicinfrastructure, which helps to promote learning-by-doing and productivity in imi-tation activities, and advanced infrastructure, which promotes knowledge networksand innovation. Numerical experiments, based on a calibrated version for a low-income country, show that changes in the level and composition of public investmentin infrastructure may have signi…ficant effects on the structure of the labour force andthe speed of industrial development.

Thesis (Ph. D.)--University of Chicago, Dept. of Economics, 1988. / Includes bibliographical references (leaves 196-198).

In this three-part essay, we explore the classical issue of the interplay between inequality and growth and the role of government in the underlying dynamics using modern macroeconomic analytical tools and and econometric methods. In the first chapter, we frame the issues within an environment of endogenous labor supply where the government serves as both a facilitator of production and a source of redistribution. Herein we model and numerically simulate the effects on inequality and growth of an expansionary fiscal policy in the harnessing of externalities emanating from productive government capital which is subject to relative congestion. The results from this assessment indicate that congestion accelerates the time-path to steady-state convergence while moderating the distributional consequences of fiscal expansions and strengthening the potential for a tradeoff between instantaneous and long-run policy outcomes. Through numerical simulations we further demonstrate the inability of the capital income tax to ensure redistribution in the long run for significantly high levels of congestion such that the sole possibility for the joint realization of economic growth and decreasing inequality resides in the deployment of a hybrid tax scheme which disproportionately strengthens the return to labor. In the second chapter, we explore the distributional properties of the Barro (1990) model of productive government spending in the presence of endogenous labor, distortionary taxes and congestion externalities. We derive an optimal tax combination and demonstrate the effects on growth and inequality which arise from its enablement in circumstances where the government share is both optimally and sub-optimally determined for varying levels of congestion. Utilizing the endogenous response of labor to capital ownership, we show that depending on the tax regime adopted, a conflict between equity and efficiency exists regardless of whether inequality is evaluated in terms of income or welfare. In the third chapter, we utilize an extensive database to establish the strength of response of poverty to changes in economic growth as being positively influenced by improving institutional indices where poverty is evaluated at the $2.00/day margin. Accordingly, we establish the possibility that the war against poverty can be fought as much by policies that promote growth as by the effectuation of structural reforms which advance healthy economic development.

O Brasil enfrenta uma aceleração do processo de globalização, que representa um grande desafio, principalmente para países em desenvolvimento. Este desafio requer não apenas uma adaptação das empresas brasileiras, mas também uma resposta política comprometedora. Para buscar posição competitiva na economia mundial é necessário que exista uma integração entre o investimento público, competitividade da indústria e bem-estar social. Nos países desenvolvidos, a política industrial, os bancos de desenvolvimento e os agentes públicos atuam de maneira sintonizada e canalizam seus esforços para setores estratégicos, como infra-estrutura, P&D e atividades inovadoras, buscando aumentar a produtividade e competitividade de suas indústrias. A partir desse contexto, o objetivo do presente trabalho é analisar o impacto da atuação do Banco Nacional de Desenvolvimento Econômico e Social (BNDES), no que diz respeito aos financiamentos de grande porte, no período de 2002 e 2003, enquanto agente de desenvolvimento, modernização e estimulador da competitividade da indústria brasileira. Compreende-se importância neste trabalho por permitir analisar a posição do BNDES no desenvolvimento e crescimento da indústria nacional, além de iniciar a construção de um processo de avaliação de sua atuação. Isso poderá contribuir no sentido de aprimorar operações em curso e futuras, em função das experiências passadas, além de permitir correção de rumos e garantir transparências às ações do Banco, no que diz respeito à sua contribuição com as políticas nacionais. / Brazil has been facing acceleration in the globalization process, which represents a huge challenge, mainly for developing countries. This challenge requires not only an adaptation in the brazilian companies, but also an involved political attitude. In order to find a competitive position in the worldwide economy, integration among the public investments, industry sense of competition, and social well-being is necessary. In developed countries, the industrial politics, the developing banks, and the public agents work synchronically and aim their efforts towards strategic sectors, like infrastructure, development and reseach, and new activities, trying to increase productivity and competition of their industries. Based on this context the objective of this paper is to analyze the impact of the acting of Banco Nacional de Desenvolvimento Econômico e Social (BNDES), concerning the large financing, in the years of 2002 and 2003, as a modernization and developing agent, and a stimulant of competition in the brazilian industry. This paper has importance because it starts an analysis of the position of BNDES in the development and increasing of the national industry, as well as the process of evaluation of its acting. This can contribute in the sense of improving ongoing and future operations, due to past experiences, as well as it allows correction in the directions, and guarantees transparency over the actions of BNDES, regarding its contribution for the national politics.

O Brasil enfrenta uma aceleração do processo de globalização, que representa um grande desafio, principalmente para países em desenvolvimento. Este desafio requer não apenas uma adaptação das empresas brasileiras, mas também uma resposta política comprometedora. Para buscar posição competitiva na economia mundial é necessário que exista uma integração entre o investimento público, competitividade da indústria e bem-estar social. Nos países desenvolvidos, a política industrial, os bancos de desenvolvimento e os agentes públicos atuam de maneira sintonizada e canalizam seus esforços para setores estratégicos, como infra-estrutura, P&D e atividades inovadoras, buscando aumentar a produtividade e competitividade de suas indústrias. A partir desse contexto, o objetivo do presente trabalho é analisar o impacto da atuação do Banco Nacional de Desenvolvimento Econômico e Social (BNDES), no que diz respeito aos financiamentos de grande porte, no período de 2002 e 2003, enquanto agente de desenvolvimento, modernização e estimulador da competitividade da indústria brasileira. Compreende-se importância neste trabalho por permitir analisar a posição do BNDES no desenvolvimento e crescimento da indústria nacional, além de iniciar a construção de um processo de avaliação de sua atuação. Isso poderá contribuir no sentido de aprimorar operações em curso e futuras, em função das experiências passadas, além de permitir correção de rumos e garantir transparências às ações do Banco, no que diz respeito à sua contribuição com as políticas nacionais. / Brazil has been facing acceleration in the globalization process, which represents a huge challenge, mainly for developing countries. This challenge requires not only an adaptation in the brazilian companies, but also an involved political attitude. In order to find a competitive position in the worldwide economy, integration among the public investments, industry sense of competition, and social well-being is necessary. In developed countries, the industrial politics, the developing banks, and the public agents work synchronically and aim their efforts towards strategic sectors, like infrastructure, development and reseach, and new activities, trying to increase productivity and competition of their industries. Based on this context the objective of this paper is to analyze the impact of the acting of Banco Nacional de Desenvolvimento Econômico e Social (BNDES), concerning the large financing, in the years of 2002 and 2003, as a modernization and developing agent, and a stimulant of competition in the brazilian industry. This paper has importance because it starts an analysis of the position of BNDES in the development and increasing of the national industry, as well as the process of evaluation of its acting. This can contribute in the sense of improving ongoing and future operations, due to past experiences, as well as it allows correction in the directions, and guarantees transparency over the actions of BNDES, regarding its contribution for the national politics.

Cette thèse porte sur l’analyse de l’importance des contributions des infrastructures de transport au développement économique et social en tenant compte des spécificités propres à l’économie djiboutienne. Nous avons effectué cette analyse dans le cadre théorique de l’industrie des réseaux, de l’économie spatiale et des modèles de croissance endogène. En tant que composante des industries de réseaux, les réseaux de transport sont sources d’économies externes positives qui se diffusent à l’ensemble de l’activité économique et qui font d’eux un facteur de développement économique indispensable. Ces effets externes peuvent s’exercer dans le voisinage immédiat des infrastructures de transport et peuvent influencer les choix de localisation des acteurs économiques. Ils ont aussi des effets macroéconomiques qui se propagent aussi à l’échelle de la nation et modélisés par les nouvelles théories de la croissance. En nous appuyant sur les apports théoriques des modèles de croissance endogène, nous avons effectué une analyse économétrique pour mesurer les effets exercés par les dépenses publiques et privées d’investissement sur l’évolution du revenu réel dans le cas de Djibouti. Nous avons basé l’étude économétrique sur l’estimation d’une fonction de production agrégée par la méthode de cointégration et le modèle Vectoriel à Correction d’erreurs (VECM). Les résultats des estimations ont montré que, conformément à ce qui était attendu, à long terme, le stock de capital privé a un effet positif significatif sur le du revenu réel. A l’inverse, le stock de capital public a un impact négatif significatif sur la dynamique du PIB réel aussi bien dans le court terme que dans le long terme. Mots clés : Infrastructures de transport, Développement, croissance, investissements publics, port de Djibouti, port de Doraleh, transport maritime, COMESA. / This thesis focuses on the analysis of the importance of the contributions of transport infrastructure into economic and social development, taking into account the specificities of the Djiboutian economy. We conducted this analysis in the theoretical framework of economics of networks, spatial economics and endogenous growth models. As part of the network industries, transport networks are sources of positive external economies that spread to the entire economic activity which makes them an indispensable factor in economic development. These externalities can affect the immediate vicinity of transport infrastructure and may influence the location choices of economic actors. They also have macroeconomic effects that spread across the nation and that are modeled by the endogenous growth theories. Relying on the theoretical contributions of endogenous growth models, we conducted an econometric analysis to measure the effects exerted by public and private investment on the evolution of real income per capita in the specific case of Djibouti. We based our study on the econometric estimation of an aggregate production function of two factors (public capital stock and private capital stock) by the method of cointegration and the Vector Error Correction Model (VECM). The estimation results indicated that, in accordance with what was expected, in the long term, the stock of private capital has a positive and significant effect on real income per capita. Conversely, the stock of public capital has a significant negative impact on the dynamics of real GDP per capita in both the short term and the long term. Keywords : Transportation Infrastructure, Development, Growth, public investment, Djibouti port, Doraleh port, maritime transport, COMESA.

Submitted by Cristiane Shirayama (cristiane.shirayama@fgv.br) on 2011-08-20T18:24:47Z No. of bitstreams: 1 TESE_CAIO CESAR MUSSOLINI.pdf: 657119 bytes, checksum: 255ea8ba1370490f062bc5487a79a09d (MD5) / Approved for entry into archive by Gisele Isaura Hannickel (gisele.hannickel@fgv.br) on 2011-08-22T12:12:58Z (GMT) No. of bitstreams: 1 TESE_CAIO CESAR MUSSOLINI.pdf: 657119 bytes, checksum: 255ea8ba1370490f062bc5487a79a09d (MD5) / Approved for entry into archive by Gisele Isaura Hannickel (gisele.hannickel@fgv.br) on 2011-08-22T12:25:32Z (GMT) No. of bitstreams: 1 TESE_CAIO CESAR MUSSOLINI.pdf: 657119 bytes, checksum: 255ea8ba1370490f062bc5487a79a09d (MD5) / Made available in DSpace on 2011-08-22T13:04:14Z (GMT). No. of bitstreams: 1 TESE_CAIO CESAR MUSSOLINI.pdf: 657119 bytes, checksum: 255ea8ba1370490f062bc5487a79a09d (MD5) Previous issue date: 2011-05-20 / This thesis aims to contribute with the debate regarding fiscal policy role on a macroeconomic level, from either the impact over short run output fluctuations and aggregate variables or the effect on long run growth and welfare. We focus on the productive government spending role. The short run analysis is based on a Real Business Cycle (RBC) model, where public capital is an additional input in the production function, along with private capital and labor, while the government keeps a balanced budget every period. The model captures quite well the high volatility of government spending (consumption and investment) and the procyclical behavior of the Brazilian fiscal policy, in the period 1950-2003. Subsequently, we estimate the main parameters that influence fiscal policy using bayesian methods. The fiscal variables (investment, consumption and tax rate) help in explaining the private variables behavior. The welfare analysis predicts that increasing government investment through lowering its consumption raises welfare, as well as reducing the tax rate. The long run analysis is based on an overlapping generations model with endogenous growth and public debt, where the government sector can choose between productive and nonproductive spending. The theoretical model‘s results indicate that the impact of productive government spending over long run growth depends negatively on debt size, tax burden and primary deficit, where a multiple equilibrium outcome is possible. In order to check the theoretical claims, we estimate a growth regression that depends on the productive spending and its interactions with the other fiscal variables for a heterogeneous sample of countries. Indeed, the main theoretical results are substantiated by the empirical analysis. / O objetivo desta tese é colaborar com a discussão sobre o papel da política fiscal em nível macroeconômico, seja em termos do impacto sobre as flutuações de curto prazo no produto e demais variáveis agregadas, ou no efeito que esta exerce sobre o crescimento e bem estar de longo prazo, sendo que uma atenção especial será dada ao papel dos gastos produtivos do governo. A análise de curto prazo é baseada em um modelo de Real Business Cycle (RBC) em que o capital público entra na função de produção como um insumo adicional ao capital privado e ao trabalho, sendo que o governo mantém o orçamento equilibrado a cada período. Os resultados indicam que o modelo consegue reproduzir bem a alta volatilidade dos gastos do governo e o caráter procíclico da política fiscal no Brasil, para o período de 1950 a 2003. Posteriormente, é feita a estimação dos principais parâmetros que influenciam a política fiscal pelo método bayesiano. As variáveis fiscais (investimento, consumo e taxa de impostos) ajudam a explicar boa parte do comportamento das variáveis privadas. Em termos de bem estar, o modelo prevê que aumentar o investimento do governo através de uma diminuição no consumo do mesmo gera um ganho de bem estar considerável, bem como reduções na taxa de impostos. A análise de longo prazo é baseada um modelo de gerações sobrepostas e crescimento endógeno com dívida pública, onde o governo executa gastos considerados produtivos e improdutivos. Os resultados do modelo teórico indicam que o impacto dos gastos produtivos do governo sobre o crescimento de longo prazo depende negativamente do tamanho da dívida, da carga tributária e do déficit primário, podendo ocorrer um cenário com equilíbrios múltiplos. De maneira a testar as predições teóricas, é estimada uma equação de crescimento em função do gasto produtivo e interações com as demais variáveis fiscais para uma amostra de países heterogêneos, e de fato, comprovam-se empiricamente os resultados do modelo teórico.