The impact of transport infrastructure on global competitiveness: a cross-sectional analysis

Abstract

The objective of transport infrastructure provision is to reduce the distance effect and transport costs and is therefore a key element for improving competitiveness. Thus, this paper aims to assess the effect of transport infrastructure on national competitiveness depending on the level of evolution of other factors affecting the economy.

Thus, to carry out this study, we use multiple regression model and cross-sectional data for 137 countries. This econometric methodology was adopted to estimate the relationships between the variables. The focus is first on the relationship between national competitiveness and ten independent variables, the same as the World Economic Forum pillars. Next, we proceed to determine the relationship between the quality of the overall infrastructure and its four components. The data set is collected from the Global Competitiveness Report of the year 2017-2018.

The results confirmed that national competitiveness is impacted by the level of institutional development and seven other factors, including transportation infrastructure. The main bottlenecks that hinder the development of the national economy were identified. The final goal is to present academics and policy-makers with a relevant means of implementing appropriate economic strategies. The main suggestion is that the economic competitiveness of a country can be improved not only through the development of transport infrastructure but also through the implementation of several actions affecting the potential sectors.

Keywords: Transport infrastructure, national competitiveness, cross-section, global competitiveness index

JEL Classification: H00, H54

Paper type: Empirical research