Essays on the political economy of public infrastructure and economic development in regional economies: Internal migration, political cycles and child mortality

The aim of this dissertation is to study the role of local politics in the economic development of regional economies by analyzing the decision to spend on local public infrastructure, and its effect on population welfare. This thesis addresses two relevant phenomena and their effects on public infrastructure investment: internal migration and political cycles. About internal migration, this thesis provides a rationale for the role of population and labor force mobility in the decision to spend local public funds in public infrastructure in open metropolitan areas -with perfect population mobility- under different perception's approximations: voters either anticipate or not changes in wages and housing prices and the in- or out- migration generated in response to changes in local taxes and public spending composition. In addition, this dissertation investigates whether political cycles affect the development of local public infrastructure. The case study chosen is the progress of water systems in Mexican municipalities for the 1994-2001 period. A new model of political cycles is proposed to explain the existence of political cycles in water investment and explain cross-sample differences in growth of water networks. Finally, as a way to assess the impact on welfare of political and decentralizing reforms in Mexico, this thesis analyzes the effect of the evolution of water services and the decentralization of water companies on infant and child mortality at a municipal level for the same period as above.