The Role of Infrastructure in Developing New Zealand's Economy

The concept of an 'infrastructure deficit' is commonly referred to within New Zealand. A claim that there is a deficit implies that the optimal stock is greater than the existing stock (at least for certain infrastructure types) and hence new investment would yield positive net benefits. Yet little work has been conducted in New Zealand to evaluate impacts of new infrastructure investments or to analyse whether returns to infrastructure investments have been positive.

This presentation provides an overview of the impacts of some major nineteenth century infrastructure programmes and reports on current work analysing returns to recent infrastructure investments. The paper aims to draw lessons about the role of infrastructure in developing New Zealand's economy and to understand factors that may currently inhibit the full benefits of these investments from being realised.