The Impact of Government Expenditure on Road Infrastructure on Economic Development in Uganda

Abstract

This study looked at the contribution of an improved transport system to the economic development of a country by analyzing the nexus between government expenditure on road infrastructure and economic development in Uganda. In doing so, the study reviewed the 1982 -2016 period using annual data. The study found out that there is an equilibrium relationship between government spending on road infrastructure and economic development in the long run. The estimation results showed that an increase in government expenditure on road infrastructure causes an increase in output growth. It was therefore concluded that government expenditure on road infrastructure has a significant positive effect on economic development in Uganda. The study recommends that government increases construction and regular maintenance of roads. This has an advantage in that it will help in providing increased access of rural areas to the various markets consequently stimulating the agricultural sector and also will increase the country’s competitiveness especially in the East African region through the reduced transaction costs brought about by increased access across borders.