An Empirical Analysis of the Impact of Transportation Infrastructure, Industrial Capacity, and Trade Integration on Economic Growth

This study provides a comprehensive empirical analysis of the relationship between transportation infrastructure, industrial capacity, trade openness, and economic growth. Using data from 1976 to 2024, the effects of air freight, per capita manufacturing value added, and trade openness on per capita income are analyzed for 10 selected developing countries, employing panel data methods. The study emphasizes that economic growth cannot be explained solely by trade volume but must also be considered alongside production capacity and transportation infrastructure. During the analysis, cross-sectional dependence and slope heterogeneity were tested, taking into account the fundamental characteristics of panel data. Based on these findings, second-generation panel data methods were employed. In this context, long-term relationships between variables were examined using the Westerlund and Edgerton (2007) bootstrap LM cointegration test, while short- and long-term dynamics were estimated using the CS-ARDL method. This method is considered important for obtaining more reliable and consistent results by accounting for inter-country interdependence and coefficient heterogeneity. The findings indicate that a 1% increase in air transport boosts economic growth by approximately 0.47%, a 1% increase in per capita manufacturing value added boosts growth by 0.26%, and a 1% increase in trade openness boosts growth by 0.65%. These findings suggest that the combined effects of production capacity, industrialization level, and transportation infrastructure drive economic growth. In this respect, the study contributes to the literature on the determinants of economic growth.