Infrastructure-based development

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Infrastructure-based economic development, also called infrastructure-driven development, combines key policy characteristics inherited from the Rooseveltian progressive tradition and neo-Keynesian economics in the United States, France's Gaullist and neo-Colbertist indicative planning, Scandinavian social democracy as well as Singaporean and Chinese state capitalism: it holds that a substantial proportion of a nation’s resources must be systematically directed towards long term assets such as transportation, energy and social infrastructure (schools, universities, hospitals) in the name of long term economic efficiency (stimulating growth in economically lagging regions and fostering technological innovation) and social equity (providing free education and affordable healthcare).^[1][2]

While the benefits of infrastructure-based development can be debated, the analysis of US economic history shows that at least under some scenarios infrastructure-based investment contributes to economic growth, both nationally and locally, and can be profitable, as measured by higher rates of return. The benefits of infrastructure investment are shown both for old-style economies (ports, highways, railroads) as well as for the new age (high speed rail, airports, telecommunications, internet...).