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

Author

Listed:
  • Mui-Yin Chin
  • Sheue-Li Ong
  • Chew-Keong Wai
  • Yee-Qin Kon

Abstract

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.

Suggested Citation

  • Mui-Yin Chin & Sheue-Li Ong & Chew-Keong Wai & Yee-Qin Kon, 2021. "The role of infrastructure on economic growth in belt and road participating countries," Journal of Chinese Economic and Foreign Trade Studies, Emerald Group Publishing Limited, vol. 14(2), pages 169-186, February.
    • Handle: RePEc:eme:jcefts:jcefts-09-2020-0065
    DOI: 10.1108/JCEFTS-09-2020-0065
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    Citations

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    Cited by:

    1. Yeung, Hak & Huber, Jürgen, 2024. "Has China's belt and road initiative positively impacted the economic complexity of host countries? Empirical evidence," Structural Change and Economic Dynamics, Elsevier, vol. 69(C), pages 246-258.
    2. Hak Yeung & Jürgen Huber, 2023. "China’s Belt and Road Initiative and Life Expectancy in Host Countries: Empirical Analysis," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 29(4), pages 225-242, November.

    More about this item

    Keywords

    Principal component analysis; Economic growth; Infrastructure index; BRI; SDG; Panel data analysis; H54; O11; C23; F14;
    All these keywords.

    JEL classification:

    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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