Infrastructure and economic growth: evidence from Zambia

Purpose: This study aims to empirically assess how infrastructure development influenced economic growth in Zambia from 2000 to 2020. Design/methodology/approach: The study uses data from the World Development Indicators (WDI), spanning from 2000 to 2020. The selection of this time period was determined by the availability of data related to the research. The Autoregressive Distributed Lag (ARDL) bounds testing approach was used for data analysis. Findings: The findings show that economic growth is cointegrated with capacity to generate electricity, proving the existence of a long-run equilibrium relationship between them. Furthermore, the empirical results established that electricity generation capacity had a positive and significant impact on economic growth. Similarly, in the short run, electricity generation capacity, and mobile cellular services had a positive impact on economic growth. Practical implications: Policy measures should prioritise increasing capacity for producing electricity and expanding access to energy by relevant economic sectors. Increased access to energy by these sectors can raise productivity, spur economic growth and accelerate industrialisation. Also, in the light of climate change, it is crucial that policymakers explore alternate sources of electricity generation, such as green and renewable sources. Furthermore, policy initiatives should prioritise expanding mobile cellular infrastructure, given that mobile cellular technology has become a vital component of economies and continues to offer unprecedented opportunities for economic growth. Originality/value: This study presents novel empirical evidence on the unique relationship between infrastructure and economic growth in Zambia, highlighting electricity generation and mobile cellular services as pivotal factors for enhancing productivity and spurring industrial development.