Public Infrastructure and Private Sector Profitability and Productivity in Mexico

Microeconometric analysis of Mexican industry shows addi-tional investment in public infrastructure produces only a small increase in output. This suggests that the policy emphasis in Mexico should be on the better upkeep of existing infrastructure to ensure the continuity of public services rather than on new capital investment. The Policy. Plnning, and Research Comnpex distnibutes PPR WodcingPapers to disseninate the fndings of wodk in progress and to cnoournge the exchange of idcs amongr ank staff and all others inerested in development issues. These papers cary the names of the authes, refled only their views, and should be used and cited accordingly. The findings, intepeatims, and conclusions are the authors own. They should na be atibuted to the Wedd Bank. its Board of Directors, its managetnent, or any of its menberccuntries. Pu bl ic Di s