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Infrastructure Development and Subjective Well-being in Africa: Linkages and Pathways

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Abstract

Unlike previous studies which focused on the economic effects of infrastructures, this paper contributes to the literature by analysing the contribution of infrastructure development to well-being, considered the aim of all efforts. The paper uses composite infrastructure indexes from the African Development Bank, to capture infrastructure quality and the life ladder index as proxy for subjective well-being on a sample of 29 African countries during the 2007–2018 period. Estimates are done using panel corrected standard errors, Tobit regression, and the generalised method of moments. Results show that infrastructure development boosts the well-being of Africans. Further analysis at the disaggregated level shows that information and communication technology (ICT) and electricity are the main drivers of happiness in the region. After testing for possible mediators, human capital is found to be the main channel through which infrastructure development enhance subjective well-being in Africa. Therefore, policies aiming to promote the well-being of Africans should consider investments in infrastructure development, especially ICT, electricity, transport, water supply, and sanitation services. This would in turn improve the performance of institutions and human capital, contributing to the well-being of Africans.

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Fig. 1

Source: WHR (2023)

Fig. 2

Source: IRF World Road Statistics (2019)

Fig. 3

Source: ITU based on ICT indicators database

Fig. 4

Source: Author’s construction

Fig. 5

Source: Author’s construction

Fig. 6

Source: Author’s own elaborations

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Data Availability

The data underlying this article will be shared on request.

Notes

  1. Nevertheless, amidst the observed hurdles, there are still notable improvements in infrastructure development in the region. For example, according to the Africa infrastructure development index (AIDI), all scores pertaining to electricity, transport, ICT, water, and sanitation improved for virtually all countries in Africa between 2016 and 2018 (AfDB, 2018b). Also, relative to other infrastructures, telecommunication infrastructure has not only experienced progress across all income groups in Africa but also doubled total access rates albeit still low relative to South Asia with 55%, Latin America, and the Caribbean and East Asia (above 80%).

  2. The 20 saddest countries are Afghanistan, Lebanon, Sierra Leone, Zimbabwe, Congo, Botswana, Malawi, Comoros, Tanzania, Zambia, Madagascar, India, Liberia, Ethiopia, Jordan, Togo, Egypt, Mali, Gambia, and Bangladesh.

  3. Benin; Botswana; Burkina Faso; Cameroon; Chad; Congo, Dem. Rep.; Congo, Rep.; Egypt, Arab Rep.; Gabon; Ghana; Guinea; Kenya; Liberia; Madagascar; Malawi; Mali; Mauritania; Morocco; Niger; Nigeria; Rwanda; Senegal; Sierra Leone; South Africa; Tanzania; Tunisia; Uganda; Zambia; Zimbabwe.

  4. Variance inflation factors (VIFs) are used to assess multicollinearity. VIF illustrates how multicollinearity causes an estimator’s variance to increase. The collinearity of a variable increases with increasing VIF value. If the average VIF across all variables is higher than 6 and the biggest individual VIF is more than 10 (Enders, 2004), there is evidence of the multicollinearity issue. It appears that the observed VIF values for the model’s variables are accurate. The outcomes show that multicollinearity is not a concern for our variables.

  5. Let us recall that subjective well-being (happiness) as measured by the life ladder index takes values between 0 and 10. See Helliwell et al. (2019) for details on the construction of this index.

  6. Governance is a composite index constructed from principal component analysis (PCA) using the six governance indicators from the Worldwide Governance Indicators database, while secondary school enrolment (% gross) is used as proxy for human capital.

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  1. Research Laboratory in Fundamental and Applied Economics (LAREFA), Dschang, Cameroon

    Isaac Ketu

  2. Dschang school of Economics and Management, University of Dschang, Dschang, Cameroon

    Isaac Ketu

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Appendix

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Table 8 Variance inflation factor (VIF) analysis
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Table 9 Cross-sectional dependence test
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Ketu, I. Infrastructure Development and Subjective Well-being in Africa: Linkages and Pathways. Glob Soc Welf (2023). https://doi.org/10.1007/s40609-023-00322-6

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