This brief report provides conceptual perspectives on public investment using debt financing. Empirical evidence of the relationship between public investment and economic activity is provided, showing that moderate levels of debt do not impair economic growth and may provide a stimulus to growth. Arizona's public debt currently is low relative to national standards. Related to this low debt, public investment in infrastructure has fallen behind the state's population and economic growth over the last 15 years. Because of low interest rates and a construction slump that will reduce construction costs, current conditions are ideal for public investment using debt financing.
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- Public Investment Using Debt Financing and the Effect on Economic Activity - Perspectives for the State of Arizona: A Report From the Office of the University Economist
- Hoffman, Dennis (Contributor)
- Center for Competitiveness and Prosperity Research (Contributor)
- Identifier TypeLocally defined identifierIdentifier Valueazdocs: ASU 8.2:D 31/2008
Summary -- Background -- Federal government debt perspectives -- Borrowing at the state and local government level -- Infrastructure needs in Arizona -- Concluding thoughts
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Hoffman, Dennis. Public Investment Using Debt Financing and the Effect on Economic Activity: Perspectives for the State of Arizona: A Report from the Office of the University Economist (Tempe, Arizona: Center for Competitiveness and Prosperity Research, L. William Seidman Research Institute, W.P. Carey School of Business, Arizona State University, 2008)