Benchmarking economic infrastructure efficiency: How does the Latin America and Caribbean region compare?

Abstract

The Latin America and Caribbean (LAC) region has a sizable infrastructure gap. Physical assets, maintenance, and service provision are inadequate and below average for a region at its level of development. The most promising way to close the service gap is to increase efficiency. Relying on data on more than 80 countries for 2000 and 2016, this paper innovates by 1) developing a single economic infrastructure index to compare countries; 2) presenting an efficiency analysis that assesses whether LAC countries have room for improvement in the provision of the quantity and quality of economic infrastructure; 3) proposing a novel peer-identification conceptual framework to identify which countries are the relevant benchmarks for the region; and 4) providing evidence on how sound governance, regulation, rule of law, and the lack of corruption are related to infrastructure efficiency at the country level.