With President Biden handing out $6 billion for California high-speed rail projects and $2.2 billion more for other passenger-rail projects, it seems important to review some basic guidelines for infrastructure spending. Nobel-prize-winning economist Elinor Ostrom, whose work focused on incentives and institutions, once offered the following evaluation criteria:
Elinor Ostrom. Photo by Holger Motzkau.
- Efficiency: How well are inputs translated into outputs?
- Fiscal equivalence – Do those who benefit from a system pay at a level
commensurate with their benefit? - Redistribution – Does the system take from the rich and give to the poor or from rich areas to poor areas or rich groups to poor groups?
- Accountability – Do decisions reflect the desires of final users and other stakeholders?
- Adaptability – Can infrastructure providers respond to ever-changing
Environments?
