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

Mui-Yin Chin (Faculty of Accountancy Finance and Business, Tunku Abdul Rahman University College , Kuala Lumpur, Malaysia)
Sheue-Li Ong (Faculty of Economics and Administration, University of Malaya , Kuala Lumpur, Malaysia)
Chew-Keong Wai (Faculty of Accountancy, Finance and Business, Tunku Abdul Rahman University College , Kuala Lumpur, Malaysia)
Yee-Qin Kon (Faculty of Accountancy, Finance and Business, Tunku Abdul Rahman University College , Kuala Lumpur, Malaysia)

Journal of Chinese Economic and Foreign Trade Studies

ISSN: 1754-4408

Article publication date: 11 February 2021

Issue publication date: 10 May 2021

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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.

Keywords

Acknowledgements

This paper has been presented at the 2019 International Conference on High-Quality Development of China’s Economy in the New Era, China on 5–8 July 2019.

Citation

Chin, M.-Y., Ong, S.-L., Wai, C.-K. and Kon, Y.-Q. (2021), "The role of infrastructure on economic growth in belt and road participating countries", Journal of Chinese Economic and Foreign Trade Studies, Vol. 14 No. 2, pp. 169-186. https://doi.org/10.1108/JCEFTS-09-2020-0065

Publisher

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Emerald Publishing Limited

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