Abstract
Over the previous decade, annual state and local public capital outlay in the US has held relatively constant at between 11.3% and 12.5% of annual expenditure by these subnational governments. In addition, annual capital outlay has varied between 21.1% and 16.3% of outstanding long-term state-local public-purpose debt. Although stable over the longer period, capital expenditure clearly declined in a relative sense in 2010. Despite this relative importance, there is a dearth of recent academic research about subnational public capital expenditure. The intent of this paper is to offer an initial examination of recent state and local government public capital investment. Specifically, the authors examine: 1. trends in the magnitude of state and local government capital expenditure, 2. previous research findings about subnational government public investment, and 3. a statistical analysis of interstate differences in capital expenditure for 2007 and 2008.1