ABSTRACT

Questions are often asked about the prioritization of physical versus social infrastructure development. Should one even assign a priority, or is a balanced "integrated" approach needed? Does the answer depend on the "stage" of development? It has often been argued that it is the combination of certain physical and/or human infrastructure endowments that matters. One at a time they may not help much. The returns to irrigation for example may depend on education (as van de Walle 1995 found for Vietnam). There are other possible interaction effects such as the possibility that greater ethnic cohesion in an area increases the chances of cooperation and hence the returns to investments in geographic capital.