Infrastructure for Regional Co-operation

Regional co-operation has received very considerable attention as means of stimulating 'inclusive-growth' in DMCs. Conceptually such discussions can be seen as a part of the analysis of the 'New Regionalism'. The focus here is on co-operation through preferential trade and investment agreements that aim to strengthen structural economic reform, aid economic transformation, attract foreign investment and generally raise the international competitiveness of participating countries (IDB 2002). The issue the authors discuss in this paper is how and why infrastructure can assist in this process. Whilst it may seem intuitively obvious that co-operation and economic activity more generally require infrastructure the authors seek to clarify more sharply why this might be so and thus provide a framework for subsequent empirical analysis of where policy interventions might be most effective. This paper was presented at the Latin America/Caribbean and Asia/Pacific Economics and Business Association (LAEBA)'s 3rd Annual Meeting held in Seoul, South Korea on November 16th, 2006.