This paper evaluates the role of rural infrastructure on the performance of some agricultural crops in Colombia. The study utilizes geo-referenced cross sectional data of four crops, coffee, rice, beans and plantains, collected for the majority of municipalities. Using genetic matching models, we find that both having access to irrigation and drainage systems and better infrastructure for marketing-rural roads and nearby retail and wholesale centers-significantly increase crop yield as well as planted and harvested areas. Results are robust to a suitable set of matching algorithms. The positive and significant impact on agricultural development provides support to reorient agricultural policy towards the supply of public goods that pushes up productivity.

Las opiniones contenidas en el presente documento son responsabilidad exclusiva de los autores y no comprometen al Banco de la República ni a su Junta Directiva.

This paper provides evidence on the positive role of fiscal decentralization on regional economic growth in Colombia since the promulgation of the Political Constitution of 1991. The empirical strategy involved the choice of a suitable estimator for the panel data approach, the Augmented Mean Group Estimator, which allows adding unobserved determinants suggested by literature to traditional long term explanatory factors. The strategy was complemented with exercises that helped us to support the results coming from (i) crosssection models for different periods and various control variables, (ii) test on the complementarity hypothesis between public goods provided by different jurisdictions (spillover effects), and (iii) an assessment of unconditional convergence in regional income differences.

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