Growth in the volume of world trade, which is at the heart of the processof globalisation, has, with few exceptions, continued unabated for more than half a century. Transport infrastructure is arguably one of the main determinants of trade costs, which are, in turn, a major determinant of thevolume of world trade. This paper examines the following three aspects ofthe relationship between globalisation and infrastructure: the contribution that infrastructure makes to increasing international trade, through its influence on transport costs, using analytical and empirical perspectives; the implications for domestic infrastructure policies emanating from empirical studies of the rate of return to public infrastructure capital in various countries; and the international dimension of public infrastructure investments, emanating from international spill-overs. The three aspectsare addressed in sections two, three and four respectively. Section five provides some concluding remarks. For the covering abstract see ITRD E141216.
Abstract