La Composición del Gasto Público y el Crecimiento Económico

In this paper the effects of government spending on economic growth are analyzed. In this sense, the aim is to examine the implications for growth by developing a simple model of capital accumulation in a sector where productive government spending takes the form of public investment in infrastructure and is endogenous, so that allow a balance subject to a transitional dynamics. To achieve this, the infrastructure is introduced as a stock of public capital in the form of an external input in the production function and assuming that agents take as given public policy when making their decisions on consumption and investment. It is further assumed that the government chooses the optimal public policy that maximizes the welfare of the representative agent taking as given the decision rules of the agent in order to characterize the evolution of public and private capital along a dynamic path