Infrastructure and GDP Growth: A Cyclic Effect

Abstract

Infrastructure development plays a significant role in the economic state of a country, but not enough emphasis has been laid to study the impact of infrastructure spending on the GDP of Pakistan. Hence, the aim of this study is to determine the relationship between the expenditure on infrastructure and GDP. Further, to evaluate the degree of impact specific components of infrastructure have on the economic growth of Pakistan. Data was collected that was in scattered form and analysed numerically which lead to the conclusion that both, Hard and Soft infrastructure directly affect the GDP of Pakistan. Among different trends that were studied, the regression tests show that Buildings and Utilities play a greater role in the GDP of Pakistan and on a broader scale it was concluded that the government should invest more in hard infrastructure and in the sub sectors of waterways and transport specifically.