Transport Infrastructure and Economic Growth: Evidence from Africa Using Dynamic Panel Estimates

Abstract

Empirical evidences on the importance of transport capital development in fastening productivity and economic development for panel sets, particularly for African countries and island state cases, have been very scarce in the literature. Such type of study is very important as public finance i s limited and sustainable transport improvements usually have opportunity costs. Planners need guidance, based on solid empirical grounds, to aid in their decision t o improve existing transportation and build new infrastructure. This study analyses t he contribution of transport capital to growth for two different data sets namel y for a sample of Sub Saharan African (SSA) countries and also for a developing s tates (SIDS) using both cross sectional and panel data analysis. In both sample c ases, the analysis concluded that transport capital has been a contributor to the eco nomic progress of these countries. Analysis further revealed that in the SSA case, the productivity of transport capital stock is superior as compared to that of overall ca pital. Such is not the case for the SIDS where transport capital is seen to have the av erage productivity level of overall capital stock.