The impact of infrastructures on economic growth in selected east and west asian countries

In the theory of economic growth, infrastructure is considered one of the most important tools in transferring high-technology from developed countries to developing ones; because developing countries are lack of required infrastructures, particularly in the case of educated population in high level of human health. Infrastructures can also lead to increasing efficiency as well as business activities and thereby reducing production costs and transport cost; thus they provide access to market facilities. In this paper, the impact of infrastructures on economic growth in selected East and West Asian countries during 1980–2012 has been studied. To investigate this purpose, simultaneous equations systems are applied which are estimated by 2 SLS method. Results show that the impacts of social and economic infrastructure coefficients on economic growth in selected East Asian countries are 0.70 and 0.60, respectively. However, the affecting coefficients of social and economic infrastructures on economic growth in selected West Asian countries are 0.26 and 0.10, respectively. Results showed more highlighted impact of infrastructures on economic growth in selected East Asian countries rather than in West.