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Infrastructure development and population growth on economic growth in South Africa

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  • Stungwa, Sanele
  • Daw, Olebogeng David

Abstract

The objective of this study is to examine the correlation between infrastructure development and population growth on economic growth in South Africa. The study employed Cross-section Seemingly Unrelated regression to analyze the relationship between infrastructure development and population growth on economic growth using an annual panel data collected from nine provinces for the period 2006-2019. The results showed that infrastructure is not an effective instrument to stimulate economic growth. Provincial government expenditure was found to have a positive and significant relationship with economic growth. The study found that unemployment and economic growth have a negative and significant relationship. Moreover, the results revealed that population has a positive and statistical impact on economic growth. The granger causality test found that there is a causality running from population growth to infrastructure unidirectionally, meaning that population growth has an impact on infrastructure development in South Africa. To correct the problem of having harmful infrastructure on economic growth, South African policy makers should ensure that there is no lack of clarity about national objectives and standards and lack of coordination in the development of natural instruments and inconsistent implementation of national objectives. There is a need to invest more on infrastructure in South Africa.

Suggested Citation

  • Stungwa, Sanele & Daw, Olebogeng David, 2021. "Infrastructure development and population growth on economic growth in South Africa," MPRA Paper 110884, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:110884
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    References listed on IDEAS

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    Cited by:

    1. Hlongwane, Nyiko Worship & Daw, Olebogeng David, 2021. "An increase of electricity generation can lead to economic growth in South Africa," MPRA Paper 111018, University Library of Munich, Germany.
    2. Nyiko Worship Hlongwane & Olebogeng David Daw, 2023. "Electricity Consumption and Population Growth in South Africa: A Panel Approach," International Journal of Energy Economics and Policy, Econjournals, vol. 13(3), pages 374-383, May.
    3. Leviticus Mensah & Murad Abdurahman Bein, 2023. "Sound Corporate Governance and Financial Performance: Is There a Link? Evidence from Manufacturing Companies in South Africa, Nigeria, and Ghana," Sustainability, MDPI, vol. 15(12), pages 1-24, June.

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    More about this item

    Keywords

    Infrastructure; Population; Economic growth; Cross-section Seemingly Unrelated Regression South Africa;
    All these keywords.

    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • H76 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Other Expenditure Categories
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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