INFRASTRUCTURE PRODUCTIVITY ESTIMATION AND ITS UNDERLYING ECONOMETRICSPECIFICATIONS - A SENSITIVITY ANALYSIS

In recent years researchers have considered a variety of regional mode ls relating to infrastructure productivity. These models are often bas ed upon overly simple econometric specifications and are typically for mulated as if spatial interactions are absent. In this paper, we try t o account for some of these shortcomings. We do this by considering sp atial lags of certain independent variables, as well as of the depende nt variable. We also consider spatial correlation of the error terms, general patterns of heteroscedasticity and of time series autocorrelat ion, and systems problems. Our results strongly suggest that regional infrastructure productivity involves spatial spillovers relating to bo th observable variables and error terms. They also suggest that corres ponding coefficient estimates are very sensitive to model specificatio ns.