The role of infrastructure on economic growth in belt and road participating countries

Chin, Mui-Yin and Ong, Sheue-Li and Wai, Chew-Keong and Kon, Yee-Qin (2021) The role of infrastructure on economic growth in belt and road participating countries. Journal of Chinese Economic and Foreign Trade Studies, 14 (2). pp. 169-186. ISSN 1754-4408, DOI

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Purpose This study aims to delve deeply into the role of infrastructure on economic growth in 59 belt and road initiative (BRI) participating countries from various regions of the world as the main objective of BRI is to encourage the participating countries to improve investment and trade facilitation via infrastructure. Besides, the development of infrastructure is in line with the United Nations' 2030 sustainable development goals (SDG). Design/methodology/approach This study encompasses all of the important physical infrastructure factors to compute a composite infrastructure index. Thereafter, this study used both the panel cointegration and the panel Granger causality tests to investigate the impact of the infrastructure index and other essential factors on economic growth. Findings The empirical results signify the importance of infrastructure development on economic growth in both the long-run and short-run. Besides, it is evident that capital, expenditure on health and education, as well as exports, will accelerate economic growth. Originality/value The findings of this study could contribute to the literature regarding BRI in two ways. First, it will provide insight to the policymakers of China and the BRI participating countries on whether infrastructure development is worthy of huge investment so as to enhance the success of the BRI. Second, the outcome of this study will give policymakers a better understanding of the determinants of economic growth, which, in turn, will help them in designing effective policies.

Item Type: Article
Uncontrolled Keywords: Principal component analysis; Economic growth; Infrastructure index; BRI; SDG; Panel data analysis; H54; O11; C23; F14
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HF Commerce > Business
Divisions: Faculty of Business and Economics > Department of Economics and Applied Statistics
Depositing User: Ms Zaharah Ramly
Date Deposited: 07 Sep 2022 00:32
Last Modified: 07 Sep 2022 00:32

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