somewhat similar to that of the literature on institutional quality and development: Pande and Udry (2005) conclude that this literature has provided reasonably strong certainties on the fact that good institutions are a necessary condition for economic development to take place, but that it is time to move to a finer, microeconomic approach to specific institutions in order to derive meaningful policy implications. In that sense, Jorgenson’s statement (“The intrusion of macroeconomists armed with conventional econometric techniques into the infrastructure debate has been counterproductive”) could probably be adapted to: “The intrusion of macroeconomists armed with conventional econometric techniques into the infrastructure debate has yielded some useful insights (as well as a lot of confusion), but sticking to this approach much longer would be counterproductive”.

_So, what can macro-data still do for us?_

- _They are useful to provide a general picture of the level of infrastructure development across countries (see introduction), but as I argue below, the aggregation of microeconomic survey data is the more promising avenue to develop such data._

- _They should give up the central role that they have had in the last twenty years in the empirical literature on the effect of infrastructure on development._

- _One area, however, in which they may prove useful, is the study of how institutional, regulatory and political economy characteristics of countries or regions affect the amount and quality of infrastructure services provided at the sector level. This implies strengthening the systematic collection of data on these aspects, such as is currently the case for telecommunications in the ICT “At a Glance” table in the Development Data Platform, or the recent logistic data (World Bank, 2007)._

- _It would also benefit from a major theoretical modeling effort of the channels involved._

# **_Key Working Objectives_**

- Step up current efforts to analyze the link between infrastructure sectors’ organization (including, among others, degree of competition, ownership, etc.), regulatory governance and sector’s performance (See Andres, Guasch and Lopez Azumendi, 2007, for an example of this approach with Latin American data). The objective should be to end up having a systematic picture of the results with broad international coverage, allowing for lessons to be drawn at the sector level, discriminating by initial level of development and other relevant country level characteristics (political system, inequality, etc.), as envisioned for example in Vagliasindi (2007).

- Some of the key aspects to be analyzed include optimal organization, regulatory institutions, the sequencing of policy measures, the impact of measures geared towards the development of capacity to coordinate infrastructure development, etc.

- More generally, when it comes to political and institutional aspects, an effort should be made to disentangle formal laws and regulations from the quality of their implementation, their enforcement, etc.

- The empirical objective described above should be guided by an important modeling effort of the different channels involved. Key areas here include the impact of fiscal constraints on public investment (Servén, 2007), the link of

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