The Determinants of Economic Growth: The Role of Infrastructure

Fosu, Prince (2019): The Determinants of Economic Growth: The Role of Infrastructure.

Abstract

The main objectives of the study were to examine the effect of infrastructure (i.e. railway network) on economic growth and to examine the direction of causality between economic growth and infrastructure using historical data covering the period of 1980 to 2016 and cointegration analysis. The findings from the study revealed a positive and significant effect of infrastructure on economic growth in the long-run however, the effect of infrastructure on economic growth was not significant in the short-run analysis. Also, the test of causality found a unidirectional causality running from economic growth to infrastructure. To increase economic growth in the United States, this study recommends that both the Federal and the State Government should increase its investments in infrastructure spending especially in railways.

• Item Type: MPRA Paper
• Language: English
• Keywords: economic growth, infrastructure, inflation, trade deficit, United States
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O44 - Environment and Growth; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R4 - Transportation Economics; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R4 - Transportation Economics > R42 - Government and Private Investment Analysis ; Road Maintenance ; Transportation Planning

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