Infrastructure Finance: Aims, Attitudes and Approaches

Publisher Website
Google Scholar
Abstract
There is an increasing awareness of the need to devise new methods of financing infrastructure. Two ways of decreasing reliance on public borrowing for infrastructure are by shifting public sector cost recovery from recurrent charges to capital levies and by making private interests directly responsible for providing and financing the service. Public sector pricing of infrastructure should aim to reflect long-run marginal cost; it should extend to cover external effects; and, where possible, its impact should accord with principles of social justice. The use of benefit assessment principles and developer contributions are two ways of achieving these objectives. There is undoubtedly also a role for private sector provision of some categories of infrastructure; but it is not as important as the development of a system of public sector cost recovery.