Defining Infrastructure

To engage in comprehensive and intelligent discussion regarding our nation’s infrastructure policy, we first need to be thoughtful about what qualifies as “infrastructure.” There is no unanimously adopted definition of infrastructure across sectors or policy lexicon. Many definitions describe “infrastructure” as the physical components of various systems that provide the essential services a community needs to function, while others have attempted a more technical definition of the term. For example, economists define infrastructure as having two main features: Infrastructure (1) originates because of investment expenditure and is characterized by long duration and technical indivisibility and (2) is a public good, which means that users cannot be excluded. We’ve traditionally thought of infrastructure more loosely as anything that facilitates the movement of people, goods, or services for personal or economic use.

Even if all parties agree on a general definition of “infrastructure” as a whole, there are two sub-types of infrastructure: hard and soft. Hard infrastructure is what one might normally think of when the word is used. That is, roads and bridges, ports, airlines, railway, power, and telecommunication systems. This also includes the physical components of information technology such as the cabling and servers that make up data networks. Soft infrastructure, however, refers to industries and institutions such as education, health, banking and finance, chemical industry, postal shipping, and tourism. While many of these structures or systems are entirely different, they all work together to push society forward.


Who Pays for Infrastructure?

Infrastructure projects are typically (but not always) funded by those who need and use it. For example, public infrastructure, i.e. roads, bridges, schools, etc., are usually funded with public money – typically through general tax revenues collected on income and property, or excise taxes added to the costs of gasoline or airline tickets. Conversely, private actors may also choose to invest in a nation’s infrastructure development as part of their business expansion effort. For example, an energy company might build pipelines and railways in a country where it wants to refine petroleum.

Some infrastructure is funded using a public-private hybrid typically branded as P3s or “public-private partnerships.” Through these agreements, the assets, risks, and rewards are shared among the parties involved. These partnerships often expedite the construction and maintenance of infrastructure while also allowing for greater concept and design flexibility than those projects solely directed by the government.


Examples of “Other” Infrastructure

Because the definition of “infrastructure” is mushy, there is no clear, exhaustive list of what it includes. The following are less intuitive examples of how expansive and inclusive the term “infrastructure” can be.


  • Libraries are Infrastructure

A library is one unit of a system that offers literary and educational services to the community. Libraries are unique places where physical infrastructure intersects with informational and social infrastructures. Uniquely, libraries are infrastructure that disproportionately helps the disenfranchised. Libraries open their doors to those who need access to the Internet, want to take a GED class, or are seeking referrals to other community resources.

  • Airspace is Infrastructure

Airspace may not be the first thing to pop in one’s mind when the word “infrastructure” comes up, but indeed, airspace is infrastructure. It is a network of coordinated routes that help expedite travel and shipping around the globe. Like a bridge or a road, airspace requires maintenance. That is, with greater investment and planning, we can make better use of our airspace. Increased harmonization and collaboration among the public and private aviation stakeholders (think the FAA and United) will allow us to use our scarce airspace more efficiently. This harmonization matters. It can more precisely plan and streamline routes leading to shorter flight times, lower risk of incident, and reduced delays.

  • The Internet is Infrastructure

By and large, infrastructure as a category has been restricted to systems that have physical components: roads, bridges, broadband cables, and servers. But being limited by systems with physical dimensions holds us in the past. Going forward, infrastructure should not be restricted by tangibility. Infrastructure should include the virtual resources that support the flow, storage, processing, and analysis of data. The main virtual resource here is the Internet.

The Internet, itself, is infrastructure. Absent the “physical” requirement, Internet meets the definition. The Internet is a system that provides the essential services a community needs to function. It originated through investment expenditure and is characterized by long duration and technical indivisibility and it is a public good.

The services the Internet provides are many and are essentially virtual forms of traditional, physical infrastructural services. The Internet offers postal services via e-mail and it offers educational, banking and financial services, just to name a few.


Take Away

Infrastructure is everywhere. Infrastructure raises our standard of living and is what makes our lives livable, from business to leisure. It requires care and maintenance. And while much of the time infrastructure may be invisible to us, it always requires our focused attention.




The Alliance for Innovation and Infrastructure (Aii) is an independent, national research and educational organization. An innovative think tank, Aii explores the intersection of economics, law, and public policy in the areas of climate, damage prevention, energy, infrastructure, innovation, technology, and transportation.