We examine the productivity of public infrastructure in a general equilibrium context. In our model, infrastructure … to variety. Infrastructure alters factor prices, intermediate prices and the allocation of factors across sectors. The … effect on manufacturing or aggregate output, however, is indeterminate. In particular, our theory suggests that the degree of …

for this economy, thereby obtaining a theory of endogenous growth that captures in a tractable way the social nature of …

is not driving this relationship. Furthermore, theory and evidence imply that better developed financial systems ease …