Europe faces major investment in infrastructure in the coming decade in the context of the credit crisis and the broader economic crisis that followed.The article considers what the core market failures in infrastructure are, focussing on the gap between marginal and average costs, the system...

Conventional benefit–cost analysis incorporates the normally reasonable assumption that the policy or project under examination is marginal. Among the assumptions this entails is that the policy or project is small, so the underlying growth rate of the economy does not change. However, this...

The paper considers the role of infrastructure in improving economic performance, and its comparative neglect relative to traditional macroeconomic and microeconomic policies. It explains why infrastructure matters, why Britain's infrastructure performance has been poor, and summarizes the scale...