Rethinking Global Infrastructure Finance

Observers of the global economy have noted that investment in infrastructure—from airports in the U.S. to power plants in Nigeria—could help achieve sustainable growth throughout the world and address challenges in both advanced and emerging economies by raising productivity, prospective returns on a variety of capital investments, and expectations about the future. Infrastructure development can also be controversial in terms of its environmental and social impacts as well as conflation of economic, financial and political objectives. There is also the imbalance between large pools of capital prepared to invest in infrastructure and the availability of economically viable projects – the so-called “dry powder” issue. New ideas to transform this gap from a set of challenges into opportunities to create value are the focus of this project, involving several key members of the Stern School faculty – how to better harness large pools of institutional capital such as pension funds to infrastructure projects through the global capital markets. The work so far has focused on the role of public pension funds in infrastructure finance, calibrating rates of return on infrastructure investments, interactions between real estate development and infrastructure, and conflict management among infrastructure project stakeholders. Included in the project have been specific case studies – the Cheniere LNG export terminal in Louisiana, the Rutas de Lima toll road project in Peru, the Goethals Bridge reconstruction in New York, and the Dakota Access oil pipeline project across the US Midwest.

Project members:

Ingo Walter (Principal Investigator)

• Sinziana Dorobantu (NYU)
• Arpit Gupta (NYU)
• Clive Lipshitz (NYU)
• Paul Tice (NYU)
• Larry White (NYU)