摘要：The present paper considers a closed economy model with infrastructure service which isan excludable, impure public good, e.g. metro railway service, electricity service, andtelephone service etc. The physical capital required by infrastructure sector is provided bypublic-private partnership. Public and private investment may be complementary orsubstitute to each other in infrastructure production. We assume government runs a balancedbudget. We find there exists unique, saddle path stable growth rate in both the cases. Wefind that PPP model is optimal in the provision of infrastructure no matter public capital andprivate capital are a substitute or complementary to each other. But, PPP solution is notgrowth maximizing in case of substitute relationship between the public capital and privatecapital. It also makes a comparative study of decentralized economy and command economy.We find that in case of substitute relationship between private capital and public capital,command economy growth rate is higher than the competitive economy growth rate but inthe case of complementary relationship between two, command economy growth rate maynot be higher than the competitive economy growth rate.
