Benabdesselam, H. (2013), Infrastructure and growth in morocco: a national analysis towards a regional analysis

Infrastructure and growth in morocco: a national analysis towards a regional analysis
Hajar Benabdesselam

Abstract: Public investment in infrastructure is more seen as a factor for improving productive performance and private sector investment. As such it contributes to growth by strengthening the supply side of the economy. It represents an important development issue. This shift is due in particular to the work of Aschauer (1989) showed that by estimating a production function expanded public capital's role in this slowdown in U.S. productivity from the 70s. On the basis of these results, the new growth models quickly took into account public expenditure as a gain factor of self-sustaining productivity and long-term growth (Barro, 1990). In this study, we will highlight, through the construction of empirical models, the impact of infrastructure investments (aggregated and disaggregated) on domestic production. The results of the study will show the need for a wellfocused and oriented infrastructure sectors more productive and pave the way for comparative studies at a regional level. The empirical analysis of the effect of infrastructure investment on Moroccan production has been made on annual data spanning from 1980 to 2009. The model draws on the work of Aschauer and is built on the basis of a production function Cobb-Douglas. The analysis took into account real GDP as the exogenous inputs and added this function a usual infrastructure stock calculated on the basis of several indicators of physical infrastructure, social and financial. From this analysis, it appears that infrastructure investments have a positive and significant impact on economic growth in Morocco. The elasticity of output with respect to infrastructure stock is 3.2. The second result is obtained from the same function (Cobb-Douglas), but incorporating the three categories of infrastructure which are, social infrastructure, physical and economic infrastructure. It shows that the elasticity of output for different categories of infrastructure is not always positive. Most infrastructure generating economic growth is the economic infrastructure (with an elasticity of 3.2% of GDP). Then, very faintly, physical infrastructure (with an elasticity of 0.044% relative to GDP). And finally, with a negative elasticity, social infrastructure does not contribute to the economic growth in Morocco.
The third result concerns the direction of causality between economic growth and investment in infrastructure and shows that causality is bidirectional. Infrastructure investments promote economic growth and vice versa, strong economic growth would increase infrastructure investment initiatives. In view of these results, the infrastructure is an area in which efforts still need to be made to give a boost to economic growth in Morocco. It recommends practical steps and measures to improve productivity of investment in infrastructure. It does not stop at this level as it aims to analyze the role of public infrastructure investment on growth regions of Morocco by answering to two main questions:
1 / Do infrastructure investments they have an effect on regional productivity?
2 / Can they participate in the reduction of interregional disparities?

Keywords: infrastructures, Cobb-Douglas, aggregate indicator, education, health, transport, energy, information and communication technologies, agriculture, financial sector.

JEL Classification: H54, H44, C23, C33, O47, R11

To cite this article :
Benabdesselam, H. (2013), Infrastructure and growth in morocco: a national analysis towards a regional analysis, Proceedings of 6th International Business and Social Sciences Research Conference, Dubai, UAE, ISBN: 978-1-922069-18-4.

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