Person:
Fay, Marianne

Loading...
Profile Picture
Author Name Variants
Fields of Specialization
Urban economics, Infrastructure economics, Climate change
Degrees
ORCID
Externally Hosted Work
Contact Information
Last updated: April 12, 2023
Biography
Marianne Fay, an economist specializing in sustainable development, is the World Bank director for Bolivia, Chile, Ecuador and Peru. She has 25 years’ experience in different regions of the world, contributing to knowledge on and the search for development solutions in the areas of infrastructure, urbanization, climate change, green growth and poverty reduction. She has published and edited several books and articles, including the “World Development Report 2010: Development and Climate Change,” and the report “Infrastructure in Latin America and the Caribbean: Recent Developments and Key Challenges.” Marianne is a U.S.-French binational.

Publication Search Results

Now showing 1 - 10 of 11
  • Publication
    Funding and Financing Infrastructure: The Joint Use of Public and Private Finance
    (World Bank, Washington, DC, 2018-06) Martimort, David; Fay, Marianne; Straub, Stephane
    The paper addresses the issue of the feasible level of private finance in a contracting model of infrastructure finding and financing. It characterizes the structure of financial contracts, deriving the conditions under which both public and private finance coexist. A key feature is that access to outside finance and the regulatory decision on pricing and the amount of public subsidy, hence the extent of price recovery, are jointly determined. Mobilizing private finance requires a combination of price for the service and subsidy to the service provider that is large enough, exacerbating the fundamental tensions between financial viability through cost recovery and social inclusion. The paper then shows that the feasibility trade-off responds in non-trivial ways to changes in the economic and institutional environment likely to occur along the development path. While improvements along some of these dimensions, notably in the efficiency of bankruptcy procedures, appear to ease access to private finance, others, such as the cost of public funds, actually makes public finance more efficient. Using project data from the PPI database including information on the financial structure, the authors uncover an inverse U-shaped pattern in the share of private finance, peaking for countries in the upper-middle income range, which echoes their theoretical findings.
  • Publication
    Rising Incomes and Inequality of Access to Infrastructure among Latin American Households
    (World Bank, Washington, DC, 2017-02) Straub, Stephane; Fay, Marianne
    This paper documents access to services and ownership of infrastructure-related durables in the water, energy, telecom, and transport areas, based on harmonized household survey data covering 1.6 million households in 14 Latin American countries during 1992 to 2012. The paper provides a systematic disaggregation of access and ownership rates at different levels of income and over time, and econometrically derives the country infrastructure premium, a measure of how much a household benefits from simply being located in a given country. The results show extensive inequality of access, within countries across the income distribution, but also across countries for households at similar levels of income. For water and electricity, for example, up to two-thirds of the variability in individual percentile access to infrastructure services and consumption of related assets can be explained by country residence only. In addition, few country fundamentals appear to be significant in explaining this variability, pointing to policy differences as an important determinant. The paper derives the income elasticity of infrastructure access for the full set of indicators, and uses these to estimate the time that would be needed to close the remaining gap for households at different levels of the income distribution under a "business as usual" hypothesis. Under that scenario, universal access appears to be decades away for many countries in the region. The last part discusses the policy challenges, arguing that in a context in which public budgets face strong constraints and significant increases in private investment are unlikely to be forthcoming, a large part of the solution lies in refocused investment strategies, better demand management, and improved public spending efficiency.
  • Publication
    Rethinking Infrastructure in Latin America and the Caribbean: Spending Better to Achieve More
    (World Bank, Washington, DC, 2017-04-06) Fay, Marianne; Andres, Luis Alberto; Staub, Stephane; Narloch, Ulf
    Latin America and the Caribbean does not have the infrastructure it needs, or deserves, given its income. Many argue that the solution is to spend more; by contrast, this report has one main message: Latin America can dramatically narrow its infrastructure service gap by spending efficiently on the right things.
  • Publication
    Rethinking Infrastructure in Latin America and the Caribbean: Spending Better to Achieve More
    (World Bank, Washington, DC, 2017-07-18) Fay, Marianne; Andres, Luis Alberto; Straub, Stephane; Narloch, Ulf
    Latin America and the Caribbean (LAC) does not have the infrastructure it needs, or deserves, given its income. Many argue that the solution is to spend more; by contrast, this report has one main message: Latin America can dramatically narrow its infrastructure service gap by spending efficiently on the right things. This report asks three questions: what should LAC countries’ goals be? How can these goals be achieved as cost-effectively as possible? And who should pay to reach these goals? In doing so, we drop the ‘infrastructure gap’ notion, favoring an approach built on identifying the ‘service gap’. Benchmarking Latin America in this way reveals clear strengths and weaknesses. Access to water and electricity is good, with the potential for the region’s electricity sector to drive competitive advantage; by contrast, transport and sanitation should be key focus areas for further development. The report also identifies and analyses some of the emerging challenges for the region—climate change, increased demand and urbanization—that will put increasing pressure on infrastructure and policy makers alike. Improving the region’s infrastructure performance in the context of tight fiscal space will require spending better on well identified priorities. Unlike most infrastructure diagnostics, this report argues that much of what is needed lies outside the infrastructure sector – in the form of broader government issues—from competition policy, to budgeting rules that no longer solely focus on controlling cash expenditures. We also find that traditional recommendations continue to apply regarding independent, well-performing regulators and better corporate governance, and highlight the critical importance of cost recovery where feasible and desirable, as the basis for future commercial finance of infrastructure services. Latin America has the means and potential to do better; and it can do so by spending more efficiently on the right things.
  • Publication
    Infrastructure in Latin America and the Caribbean : Recent Developments and Key Challenges
    (Washington, DC: World Bank, 2007) Fay, Marianne
    This book reviews Latin America's experience with infrastructure reform over the last fifteen years. It argues that the region's infrastructure has suffered from public retrenchment and unrealistic expectations about private involvement. Poor infrastructure now hampers productivity, growth, and poverty reduction. Addressing this requires more and better spending, and acceptance that governments remain central to infrastructure provision and supervision, although the private sector still has an important role to play.
  • Publication
    Current Debates on Infrastructure Policy
    (World Bank, Washington, DC, 2007-11) Estache, Antonio; Fay, Marianne
    This paper provides an overview of the major current debates on infrastructure policy. It reviews the evidence on the macroeconomic significance of the sector in terms of growth and poverty alleviation. It also discusses the major institutional debates, including the relative comparative advantage of the public and the private sector in the various stages of infrastructure service delivery as well as the main options for changes in the role of government (i.e. regulation and decentralization).
  • Publication
    Infrastructure in Latin America : Recent Developments and Key Challenges, Volume 1
    (Washington, DC, 2005-08) Morrison, Mary; Fay, Marianne
    In the last decade, most countries in Latin America and the Caribbean (LAC) have not spent enough on infrastructure. Total investment has fallen as a percentage of GDP, as public infrastructure expenditure has borne the brunt of fiscal adjustment, and private investment has failed to take up the slack. Most infrastructure services have therefore lagged behind East Asian comparators, middle income countries in general and China, in terms of both coverage and quality, despite the generally positive impacts of private sector involvement. This lackluster performance has slowed the LAC region's economic growth and progress in poverty reduction. Countries of the region therefore need to focus on upgrading their infrastructure, as this can yield great dividends in terms of growth, competitiveness and poverty reduction, as well as improving the quality of life of their citizens. Catching up requires significant new investment. But first, measures need to be taken to ensure that infrastructure spending produces higher returns, both economic and social. Both these tasks involve multiple challenges. The first section of the main report reviews progress made in infrastructure coverage and quality and discusses the impacts this has had on growth, competitiveness and the fight against poverty. The second section argues that the main issue has been that there has not been enough improvement in the management of resources, which have been insufficient anyway, and also reviews the region's experiences with private participation in infrastructure. The third section builds on the lessons of the last decade to tackle the key challenges: improving social and economic returns from infrastructure, managing private participation in infrastructure better and raising new finance for infrastructure.
  • Publication
    Beyond the Gap: How Countries Can Afford the Infrastructure They Need while Protecting the Planet
    (Washington, DC: World Bank, 2019-02-19) Rozenberg, Julie; Fay, Marianne; Rozenberg, Julie; Fay, Marianne; Fox, Charles J.E.; Leifman, Michael M.; Lopez-Alascio, Blanca; Nicolas, Claire
    Beyond the Gap: How Countries Can Afford the Infrastructure They Need while Protecting the Planet aims to shift the debate regarding investment needs away from a simple focus on spending more and toward a focus on spending better on the right objectives, using relevant metrics. It does so by offering a careful and systematic approach to estimating the funding needs to close the service gaps in water and sanitation, transportation, electricity, irrigation, and flood protection. Exploring thousands of scenarios, this report finds that funding needs depend on the service goals and policy choices of low- and middle-income countries and could range anywhere from 2 percent to 8 percent of GDP per year by 2030. Beyond the Gap also identifies a policy mix that will enable countries to achieve key international goals—universal access to water, sanitation, and electricity; greater mobility; improved food security; better protection from floods; and eventual full decarbonization—while limiting spending on new infrastructure to 4.5 percent of GDP per year. Importantly, the exploration of thousands of scenarios shows that infrastructure investment paths compatible with full decarbonization in the second half of the century need not cost more than more-polluting alternatives. Investment needs remain at 2 percent to 8 percent of GDP even when only the decarbonized scenarios are examined. The actual amount depends on the quality and quantity of services targeted, the timing of investments, construction costs, and complementary policies. Finally, investing in infrastructure is not enough; maintaining it also matters. Improving services requires much more than capital expenditure. Ensuring a steady flow of resources for operations and maintenance is a necessary condition for success. Good maintenance also generates substantial savings by reducing the total life-cycle cost of transport and water and sanitation infrastructure by more than 50 percent.
  • Publication
    Hitting the Trillion Mark: A Look at How Much Countries Are Spending on Infrastructure
    (World Bank, Washington, DC, 2019-02) Lee, Hyoung Il; Fay, Marianne; Mastruzzi, Massimo; Han, Sungmin; Cho, Moonkyoung
    The paper provides the first consistently estimated data set on infrastructure investments in low- and middle-income countries. To do so, the authors identify three possible proxies for infrastructure investments: two are variants on gross fixed capital formation from national accounts system data following ADB (2017) and one is based on fiscal data from the World Bank's BOOST database. Two of these proxies rely on the World Bank's Private Participation in Infrastructure database to capture the private share of infrastructure investments. Given the limitations of each of these proxies, the authors employ several transformations to derive a lower-bound estimate for infrastructure investments in low-and middle-income countries of 3.40 percent of their gross domestic product, a central estimate of around 4 percent, and an upper-bound estimate of 5 percent for 2011. Corresponding absolute amounts are US$0.82 trillion, US$1.00 trillion, and US$1.21 trillion, respectively with East Asia and the Pacific accounting for 55 percent of infrastructure investments and Africa 4 percent. The public sector largely dominates infrastructure spending, accounting for 87–91 percent of infrastructure investments, but with wide variation across regions, from a low of 53–64 percent in South Asia to a high of 98 percent in East Asia. Given the absence of fiscal or national accounts data capturing investments in infrastructure, these estimates are likely to be the best available in the near future. Nevertheless, the authors propose some possible avenues for future improvements (including an update when 2017 data are made available by the International Comparison Project), building on the excellent collaboration of multilateral development banks around this issue.
  • Publication
    Financing the Future : Infrastructure Needs in Latin America, 2000-05
    (World Bank, Washington, DC, 2001-02) Fay, Marianne
    To assess five-year demand for infrastructure investment in Latin America and the Caribbean, and the private sector's role in meeting this demand, the author developed a model to predict future demand for infrastructure - defined as what consumers and producers would ask for, given their income and level of economic activity. Overall projections over the next five years: a) A doubling of telephone mainlines per capita. b) A steady increase in electricity generating capacity. c) Small increases in water and sanitation coverage. d) Steady expansion of road infrastructure, with rail transport becoming less important. Investments of $57 billion annually for 2000-05 (roughly 2.6 percent of Latin America's GDP) are expected to be absorbed largely by electricity ($22 billion), roads ($18 billion), and telecommunications ($ 6 billion). A surge in private finance of infrastructure in recent years (roughly $35 billion in 1998, excluding divestiture payments) has disproportionately favored telecommunications ($14 billion) and transport ($12 billion). Private investment exceeds predicted need for telecommunications (although the model did not include costs associated with the emergence of cellular phones), covers about half the demand for roads, and meets just a fraction of needs in power and water and sanitation - where there will be a shortfall in investments. Projections are likely to be on the low side because they cover new investments, not rehabilitation or maintenance.