Infrastructure‐Oriented Capital Formation, Governance, and Economic Resilience: Long‐Run Evidence From CEMAC Countries

Abstract

This study examines how infrastructure‐oriented capital formation, governance quality, and structural conditions influence economic growth in six CEMAC countries during 1996–2024. Using annual panel data, gross fixed capital formation (GFCF) serves as a proxy for infrastructure‐oriented investment in the absence of consistent long‐run PPP data. Fixed‐effects estimations, interaction models, and robustness checks are employed to assess both direct and conditional effects. The results indicate that GFCF has a positive and significant effect on economic growth. More importantly, governance quality significantly strengthens this relationship, as evidenced by the positive interaction between investment and control of corruption. Marginal‐effects analysis further shows that the growth impact of investment increases as governance improves. In contrast, urbanization and private‐sector credit exert negative effects, suggesting structural constraints, inefficient credit allocation, and weak financial intermediation. Robustness tests confirm the stability of these findings across alternative specifications.