Benefits and Spillover Effects of Infrastructure: A Spatial Econometric Approach

29 Pages Posted: 31 Mar 2021

See all articles by Kijin Kim

Kijin Kim

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD)

Junkyu Lee

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD)

Manuel Leonard Albis

University of the Philippines

Ricardo III Ang

Georgia State University

Date Written: March 30, 2021

Abstract

This paper estimates the effects of transport (road and rail) & energy and ICT infrastructure (telephone, mobile, and broadband) on GDP growths in neighboring countries as well as own countries. We confirm positive direct contributions of infrastructure, access to Internet, and human capital on economic growth. The spatial panel regression models indicate that there exist positive externalities of the broadband infrastructure and human capital, and these results are robust regardless of the choice of spatial weight matrices. Our findings on spillover effects of infrastructure suggest the key role of neighboring countries’ infrastructure on own country’s economic growth.

Keywords: Infrastructure, Spillover Effects, Economic Growth, Production Function, Spatial Econometrics

JEL Classification: C21, D24, D62

Suggested Citation

Kim, Kijin and Lee, Junkyu and Albis, Manuel L. and Ang, Ricardo III B., Benefits and Spillover Effects of Infrastructure: A Spatial Econometric Approach (March 30, 2021). East Asian Economic Review Vol.25, No.1 (March 2021) 3-31 , https://dx.doi.org/10.11644/KIEP.EAER.2021.25.1.389, Available at SSRN: https://ssrn.com/abstract=3815504

Kijin Kim (Contact Author)

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD) ( email )

Philippines

Junkyu Lee

Asian Development Bank - Economic Research and Regional Cooperation Department (ERCD) ( email )

Philippines

Manuel L. Albis

University of the Philippines ( email )

Melchor Hall, Osmena Avenue, Diliman,
Quezon City,, National Capital Region 1101
Philippines

Ricardo III B. Ang

Georgia State University ( email )

35 Broad Street
Atlanta, GA 30303-3083
United States

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