Impact of Public Infrastructure Spending and Institutions on Economic Growth in Côte d’Ivoire: Results and Implications

Ouattara Sohalio

Journal of Infrastructure Development, 2023, vol. 15, issue 2, 91-115

Abstract: This study uses annual data from 1984 to 2019 for the Côte d’Ivoire to estimate the effects of public infrastructure spending, institutions, institutional shocks and their multiplicative effect on economic growth. We construct three institutional indices and interaction variables to estimate linear and nonlinear AutoRegressive Distributed lag models (ARDL). The results reveal symmetric effects of institutional shocks to democracy and regulation and conflict prevention and asymmetric effects of institutional shocks to investment promotion and the economy. The institutional index for the conflict prevention dimension is favourable to economic growth, while the other institutional dimensions remain insignificant. The institutional index of democracy and regulation amplifies the positive effects of public spending on infrastructure on per capita income in the long term. The institutional indices of investment and economic promotion and conflict prevention reduce the positive effect of public infrastructure spending on per capita income. Public debt and domestic savings have effects on per capita income. These results imply that improving institutions, particularly those promoting investment and the economy, is crucial to amplifying the benefits of public infrastructure investment in Côte d’Ivoire.

Keywords: Public infrastructure spending; institutional shocks; cointegration test (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:sae:jouinf:v:15:y:2023:i:2:p:91-115

DOI: 10.1177/09749306241299173

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