IMPACT OF ROAD INFRASTRUCTURE ON MANUFACTURING SECTOR OUTPUT IN NIGERIA

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IMPACT OF ROAD INFRASTRUCTURE ON MANUFACTURING SECTOR OUTPUT IN NIGERIA

CHAPTER ONE

INTRODUCTION

  1. Background of the study

The relationship between transport infrastructure and economic growth has attracted a lot of research effort and attention from economists, policy makers and politicians since the early 1990s. (Gramlich, 1994) said it remains essentially unclear whether the direction of causation is from transport infrastructure to economic growth or vice-versa or both. (Kessides, 1996) notes that one of the main shortcomings of research on the economic impact of transportation infrastructure is that it has so far not adequately accounted for simultaneity effects on which economic growth can lead to development of the transport system as well as result from it. Several previous studies could not confirm the direction of causation between the development of the transport sector and economic growth. In addition, most of these studies have typically relied on cross-sectional or panel data regressions. A general problem associated with such studies is that they implicitly impose or assume cross-sectional homogeneity on coefficients that in reality may vary across countries because of differences in geographical, institutional, social and economic structures. Hence, the overall results obtained from these regressions represent only an average relationship, which may or may not apply to individual countries in the sample (Bloch and Tang, 2003). 

The adequacy of road transport infrastructure determines a country’s success and another; failure in diversifying production, expanding trade, coping with population growth reducing poverty, or improving environmental conditions. A good road transport infrastructure raise productivity especially in the agricultural sector of the economy and lowers production costs. In Nigeria, the link between where the major production activities take place and where it is needed for final consumption need good road transportation that will bridge the gap, although the precise linkages between infrastructure and development are still open to debate. However, according to the World Development Report, 1994 infrastructure capacity grows step by step with economic growth.

Good road infrastructure services helps the poor contribute to environments sustainability. Clean water and sanitation, non-polluting sources of power, safe disposal of solid waste, and better management of traffic in urban areas provide environmental benefits for all income groups. The urban poor often benefit most directly from good road infrastructure services which mitigates standard of living conditions characteristic of concentrated settlements such as unsanitary conditions, hazardous emissions, and accident risks.

Integrated urban planning and transport policy can lead to more efficient use of both land and transport capacity with favourable environmental results. Expansion of transport infrastructure can reduce total pollution loads as congestion falls, average .Vehicle speeds rise, and routes are shortened. Road improvements can also encourage vehicle use and decrease emissions. Therefore, additions to infrastructure capacity are only part of the solution. Improved management of traffic and land use and promotion of non-motorized modes, cleaner fuels, and public transport are also important.

This paper is an attempt re-examine the impact of road transportation system on economic growth in Nigeria to achieve the objective above the study is structured into five sections, which are introduction, literature review/theoretical framework, the methodology, data presentation/analysis, and conclusions/recommendations.

  1. Statement of the problem

There may have been previous researches in this subject. This work gives further explanations and analysis in impact of road infrastructure on manufacturing sector output in nigeria

  1. Objectives of the study
  2. To understand the impact of road infrastructure on manufacturing sector output in nigeria
  3. To understand the relationship between road infrastructure and manufacturing sector output in nigeria
  1. Research questions
  2. What is the impact of road infrastructure on manufacturing sector output in nigeria
  3. What is the relationship between road infrastructure and manufacturing sector output in nigeria
  1. Research hypothesis

H0: There is no relationship between road infrastructure and manufacturing sector output in nigeria

H1: There is a relationship between road infrastructure and manufacturing sector output in nigeria

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