Pension Fund Investment in Infrastructure and Global Financial Regulation

Resumen

In the wake of the last financial crisis, pension funds around the world have demonstrated an increased willingness to invest in infrastructure projects. This chapter analyzes why, as well as the pros and cons of pension fund investment in infrastructure projects. It discusses the current regulatory context and outlines the regulatory changes which may be needed to expand infrastructure investment. A panel data analysis is used to assess how important a country’s financial regulatory stance is for pension fund investments in infrastructure. Although financial regulatory restrictions on infrastructure investment could be important, other influences include a country’s institutional framework, as well as the depth and strength of its financial markets, along with geographical considerations. If pension funds are to invest more in infrastructure, it may be necessary to revisit conventional regulatory considerations.