Convergence in sustainable infrastructure development and its drivers in Africa: fresh policy insight from an algorithm approach

Despite its economic benefits being widely documented, there is a significant need for improvement in the infrastructure of the African continent. Infrastructure development infrastructure in Africa varies significantly, with some regions experiencing substantial progress while others remain starkly underdeveloped. However, it is unclear how these differences have changed over time. Thus, using data from the African Infrastructure Development Index, which covers the years 2005 to 2022, this study contributes to the existing body of literature by analyzing the convergence hypothesis in the development of infrastructure across 52 African countries. This is conducted by using a nonlinear time-varying factor model. We further examine the factors influencing club membership by applying an ordered logit regression model’s marginal effects. The findings showed the absence of overall convergence for infrastructure development across African countries over the period of study. Nonetheless, we found the existence of convergence clubs, exhibiting significant disparities among the estimated clubs. The findings of the marginal effect show that foreign direct investment (FDI), labour force participation rate, financial development, trade openness, environmental quality, gross fixed capital formation, human capital, general government final consumption expenditure, and governance quality are essential to club formation. Economic growth, labour force participation, financial development, human capital, and trade openness, significantly influence club membership. Based on the results, it is suggested that policymakers should concentrate on developing plans that deal with specific challenges that various groupings of countries, especially those in the convergence clubs with lower performance, face, among others.