these constraints with optimal infrastructure investment needs at different stages of development (Fay and Yepes, 2003), the interplay between country and sector governance and different aspects of infrastructure development (level of investment, incentives to invest in maintenance vs. new investments, efficiency of different configurations, etc.). Conclusions should take into account the characteristics of the different sectors / countries under consideration.

- These aspects involve crucial and complex interactions on which theoretical insights are missing, such as the link between financial constraints (of government and operators) and involvement of external financing agents (either private or multilateral) and how the multiprincipal nature of this situation affects the level and performance of investments.

# **1.b.  Microeconometric Literature**

These contributions have in general yielded more robust insights into the human development effects of infrastructure, in particular because they allow for a better understanding of the interactions between service availability and other aspects such as financial development (Binswanger et al., 1993), level of education of household members (Thomas and Strauss, 1992), etc. This is particularly useful because infrastructure policies are not implemented in a vacuum and policy makers need to understand how they interact with other policies that affect different groups of the population. Moreover, household access data to services such as water, sanitation, electricity and telecommunications can be aggregated at the village / district /state level and used in large scale policy evaluations (more on this below when discussing sector level data recommendations).

There are of course drawbacks to the microeconomic approach. First, microeconometric contributions are by nature focused on specific cases and contexts, so they may not always provide lessons that can be generalized. Second, as already mentioned, they have difficulties in capturing entrepreneurial activities that are not owned at the household level.

The answer to this last point seems to be the development of large scale firm surveys such as the investment climate assessments (ICAs). Unfortunately, the “infrastructure content” of ICA surveys has been reduced over time. For example, Lee, Anas and Oh (1996) where able to assess infrastructure constraint for several sectors and had access to data on the cost of substitute capital investments by firms that have disappeared from more recent waves of these surveys. Moreover, apart from specific issues in the design of ICA surveys, their use to address infrastructure issues runs into a specific difficulty discussed at the end of the previous section, namely the fact that they are illequipped to address endogenous technological choices by entrepreneurs.

_It seems reasonable that micro-data should become the main focus of data development efforts._

- _Household surveys should systematically incorporate module on infrastructure, designed in such a way to enable upwards aggregation with sufficient coverage of large geographic areas._

- _This would enable the collection of data on two additional aspects: the quality and the cost of services._

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