Building the Future: Issues in Infrastructure in Canada.

• Author: McElravy, Jeff
• Position: Book Reviews

Aidan R. Vining and John Richards, editors

Toronto, Ontario: C.D. Howe Institute. (223 pp)

A collection of essays on infrastructure policy, this text seeks to better inform policymakers about general issues in infrastructure development. However, because the authors place considerable emphasis on methodological issues, readers will need a working background in public sector economics and cost-benefit analysis to fully appreciate this work.

The book begins with the standard explanations of the various types of public goods and the strategies employed by governments to overcome market failure. Although the authors emphasize that their definition of infrastructure extends beyond roads and bridges to investments in "intangible infrastructure" like elementary and secondary education, the majority of the analysis is on traditional infrastructure projects.

David Swimmer evaluates the two major studies that have assessed Canada's infrastructure stock. Although survey data indicate that Canada's position slipped relative to other nations during the 1990s, "harder" data dispute this claim. In defense of the latter view, the author points to the country's strong performance in measures of technological infrastructure and its shift from investment in construction to machinery and equipment, which he attributes to the energy crisis of the mid-1970s and the digital revolution.

David Gillen examines the impact of public capital investment on a national economy. Focusing on transportation, he finds little consensus among academics. However, it does appear that infrastructure investment has a positive influence on manufacturing productivity. Gillen finds that on a macroeconomic scale, highway construction is a...