Sustainable infrastructure for Nigeria’s sustainable economic development: whither transportation or electric power supply?

Abstract

Infrastructures, publicly or privately provided, are widely believed to be the foundation for economic development. Indeed, studies have demonstrated the relationship between physical infrastructures (especially economic infrastructures) and economic growth. But not much is known in Nigeria about sustainable economic development induced by identified sustainable infrastructure. That is, economic development and infrastructure development that provokes local inclusiveness, economic progress and environmental friendliness. Modelling the effect of a range of time series data on GDP per capita, this study found electric power supply to have a strong relationship with sustainable development but not sufficient to provoke economic development in Nigeria. It concluded that electric power supply does not serve as catalyst for sustainable economic development in Nigeria, as recommended. It is argued here that there is a need to focus on critical economic infrastructure provision and investment, which will in turn have linked effects to boost other economic sectors through inclusive and environment friendly policies and programmes.

Keywords:

• Economic development
• environment Infrastructures
• Nigeria
• sustainability

JEL CLASSIFICATION:

• Q5
• O18
• O44

1. Introduction

There is growing international and domestic consensus in development discourse on the distinctiveness of policies and processes that promote sustainability of development going beyond economic growth (Ogundipe and Apata 2013; Iheanacho 2016). Its mention at many fora may be due to growth of the quest for sustainable development pivoted on the trio of socially, economically and environmentally sustainable processes including developing economies such as Nigeria (Sturup and Low 2019). Sustainable economic development is further partly hinged on sustainable infrastructures that can provoke local inclusiveness, economic progress and environmental friendliness Odozi, Awoyemi, and Omonona 2014; Federal Government of Nigeria (FGN) 2017).

Central to these aspirations has been the critical role of infrastructures as catalysts for sustainable economic development (Oyedepo 2012; Gibson and Rioja 2017; Quenton 2017; Babatunde 2018) with particular reference to Goal 9 of the UN Sustainable Development Goals (SDG) that goal is to ‘build resilient infrastructure, promote inclusive, sustainable industrialization and foster innovation’. Further to the convergent and divergent views, infrastructure is construed in terms of material, institutional and personal foundations of development (Buhr 2009; Adewunmi 2014; Dale 2016). Either directly or indirectly provided, such infrastructure is central to the realisation of all the SDGs in any system of economic development. However, this study focuses on material infrastructures, which Buhr construed as the earning assets, equipment, circulating and/or immobile social capital, that essentially contributes to production and to activities needed to satisfy basic physical and social requirements of economic agents in an economy. These are Energy, Housing, Transport, Water and Sanitation, Information and Communication Technology infrastructures. Any one or a combination of the above in this class of infrastructure(s) contributes to sustainable, expedient and efficient distribution and allocation of resources for socioeconomic growth irrespective of the particular economic system (Foster and Nataliya 2011). The study reported here further limits the focus to Electric Power and Transport infrastructures.

Typically the influence, contribution and role of infrastructures in an economy have been viewed as responding to growth and development demands without consideration of their being sustainable. For example, transport infrastructures like rail and road facilitate efficient movement of goods and services, but their construction also affects biodiversity. Electric power supply is central to almost all economic sectors (agriculture, manufacturing, trade, education and so on) and promotes employment and improves quality of life. But such infrastructures may also make the environment vulnerable to flooding, pollution, deforestation, etc. A plethora of studies has underscored and generalized the roles of infrastructures in economic development of Nigeria. This is evident in the Building and Construction Sector (BCS) contributing from 2.88% to 3.70% of Gross Domestic Product (GDP) between years 2010 and 2016 and significantly enhancing fixed capital formation (National Bureau of Statistics (NBS) 2017; FGN 2017).

However, the infrastructures-environment nexus therefore queries the aspirations for sustainable economic development notwithstanding the huge investment on infrastructure development over the years in Nigeria (Bello-Schünemann and Porter 2017) and particularly in the face of rapid population growth, high market demand, neglect of expansion to lack of public investment, etc., evident in deplorable road network and inadequate railway system, none or epileptic power supply.

It has been reported that twenty million households are without electricity supply while about 46 per cent or 83.98 million people (as at 2017) were unconnected to the national grid (Onyekwena, Ishaku, and Akanonu 2017; KPMG 2019). Only sixteen per cent of the road network is paved (Economic Recovering and Growth Plan resulting in increasing road crashes. The unemployment rate is over 30.5%, with very slow economic growth (World Bank 2019). The nation’s economic performance is abysmal despite significant public capital spending.

Specifically, Ojo (2019, citing Federal Ministry of Finance 2017) reported that Public Infrastructural Spending (PIS) in Nigeria between the years 2000 and 2018 amounted to N8.92 trillion (Naira) regardless of private investment efforts. Moreover, road construction impairs biodiversity, especially at the construction stage, leading to a deforestation rate of 11% (1.5 million hectares annually), diminishing arable land, and decreasing income per capita from agriculture (Mba 2018; Urhie et al. 2020). Additionally, the increasing use of roads and power generation in Nigeria has engendered increased air pollution by Greenhouse Gas (GHG) emissions from non-renewable energy activities at 65% pollution rate between 2000 and 2015 (Akinyemi et al. 2017).

These economic, social and environmental issues are fundamental and appear to underscore the dilemma of sustainable economic development aspirations. They stimulate the enquiry: how does infrastructure relate to sustainable economic development in Nigeria? Moreover, which infrastructure(s) are critical? This study identifies transport and electric power supply infrastructures as critical for sustainable economic development in Nigeria, both as a general objective and in terms of the specific relationships between the identified infrastructure(s) and sustainable development. The focus of this study is the increasing centrality of infrastructures to attaining sustainable economic development and the need for public investment infrastructures in developing nations like Nigeria.

The rest of this paper is organized as follows: first a review of the related literature, then a description of methodology, and a discussion of the findings, while the last section provides a conclusion and policy recommendations.

2. Review of related literature

2.1. Conceptual review

Olaseni and Alade (2012), World Bank (2014) and Iyortyer (2017) have described infrastructure as a heterogeneous term for distinct assets and modern factor inputs that are capable of delivering steady and long-term capital appreciation for the overall good of the economy. Infrastructures are classified as: transport, energy, water and sanitation, housing, Information and Communications Technology rojects and services (that are characteristically intangible), physical but capital-intensive works and mostly executed by government and private investment with positive and or negative externality effects downstream (Baldwin and Dixon 2008; Foster and Nataliya 2011).

In Nigeria, the range of infrastructure projects include transport (roads and bridges, railways, seaport, airport), energy (electric power, renewable sources, etc.), water and sanitation (water supply, sanitation, sewerage systems, irrigation, flood control) and information and communication technology (ICT) infrastructures (see Infrastructure Concession Regulatory Commission Act ICRC 2005; National Infrastructure Master Plan, NIMP, 2013).

In Nigeria, the range of infrastructure projects include transport (roads and bridges, railways, seaport, airport), energy (electric power, renewable sources, etc.), water and sanitation (water supply, sanitation, sewerage systems, irrigation, flood control) and information and communication technology (ICT) infrastructures (see Infrastructure Concession Regulatory Commission Act (ICRC) 2005; National Infrastructure Master Plan (NIMP) 2013).

Development as a concept that emerged after World War II addressed the new challenge of rebuilding war-torn countries. The concept was aligned with economics, industrialization, finance, and infrastructures. Development included social, political, technological and institutional perspectives of human society (Dolgoff 2012; Lorenzo 2017). Ehinomen (2014) reported that Schumpeter (a renowned development economist) made the distinction clearer when he defined development as a discontinuous and spontaneous change in the stationary state which forever alters and displaces the equilibrium state previously existing. However, central to the concept of development is the creation of process(s) and assets to give poor people access to the range of social goods and services and improved living standards that underscores efforts toward continuous and sustained lifting of the standard, status and quality of life of individuals and communities in an environment (Umar and Tafida 2015).

Economic development as a concept in development studies has been interpreted in different ways. However, the United Nations Development Programme submitted that economic development strategies must be people centered. Such strategies must focus on life satisfaction and seek to save people from the scourge of poverty, illiteracy, low life expectancy at birth, dearth of water supply, poor sanitation, poor housing, poor health access, unemployment, and environmental degradation.

Under the above concept sustainable infrastructures for economic development become critical as equipment and systems that are designed to meet the peoples’ basic needs and services to provide for needs. Such infrastructures should be based on all-round sustainable principles, meaning that the development of infrastructures must be ecosystem friendly, ‘econocentric’ and people-centred from end to end (Butterfield and Low 2017; Iberdrola 2018). In emphasis, infrastructure(s) should contribute to sustainable development with wider considerations for decision processes, target beneficiaries, and changes needed: social, technological, environmental and economic (Sturup and Low 2019).

In focus, then, is the nexus between infrastructure development and environmental quality, in that infrastructure development exerts increasing and diverse environmental externalities that challenge sustainability (Maliszewska and Mensbrugghe 2019). However, alternatives are being developed to reduce these environmental risks and their economic consequences such as exploring renewable energy sources, encouraging green housing construction methods and materials, developing electric-powered transport systems, improving road networks and traffic flow (Olanipekun 2016; Losos et al. 2018; Meng and Han 2018; Li et al. 2019). Additionally, reducing negative effects of infrastructure development can be reduced through effective maintenance and innovation via, for example, alternative modes of transportation.

This study centers mostly on transport and energy (electric Power supply) with very significant socio-economic and environmental consequences in Nigeria (Akinyemi et al. 2017; Ojo 2020). The transport infrastructure band’ includes road, air and seaports, inland waterways and railway transport systems. For examplee, the ICRC (2017) reported that Nigeria has about 203,200 kilometres of the road network owned by all levels of governments that ensures about 90 per cent of movement of people and goods. However, the railway and other means of transport are being emphasised in order to ameliorate road construction impairment via increased air pollutions through fossil fuel.

Greenhouse gas (GHG) emissions from non-renewable energy activities accounted for 65 per cent between 2000 and 2015 (Akinyemi et al. 2017). Similarly, the Nigerian energy sector is a mix of subsectors related to different energy sources—renewable energy (solar, wind, generated waste and hydroelectricity) and non-renewable energy (coal, petroleum, natural gas). However, electric power is central to Nigeria’s economic development ever since its discovery and provision from 1896. There exist 14 generating plants, about 13,000 km of transmission and distribution infrastructures supplying about 5,000 MW. This is still far short of the 21,000 MW electric power demand (Ojo 2020).

Power generation via hydroelectricity and non-renewable energy impact negatively on climate change and biodiversity especially at the construction stage, leading to deforestation (at a rate of 11%, 1.5 million hectares, annually) diminishing arable land, and reducing income per capita from agriculture (Mba 2018; Urhie et al. 2020). Additionally, the intensive use of these energy sources has engendered a drive for solar energy use in other sectors like the ‘Solar for Health’ initiative as a key example of sustainable infrastructure development that will be vital to avoiding dangerous climate change, improving public services and driving the economic recovery.

Comparatively, this infrastructure-environment-growth-development nexus greatly expresses the future of sustainable economic development in Nigeria. It appears to be advanced more in transport and electric power supply and with a wider national territorial cover amongst African peers (Nigeria Sovereign Investment Authority, NSIA, 2019). Yet, Nigeria still faces a significant infrastructure deficit, which has the potential to make her economic development vulnerable to inhibiting sustainability. Some of the sustainability inhibiting factors are described and related to the nature of her political-economic system, market economy, and infrastructure investment capability (Bakare-Aremu 2013; World Bank 2019).

2.2. Theoretical review

Hirschman’s theory of unbalanced growth is focused on the economic growth and development strategy of underdeveloped countries. The theory’s principle is proportionality of growth to strategic sector investment rather than simultaneous investment in all sectors. An unbalanced approach to development is due to lack of resources and exigency of efficient use of available resources in the less developed countries’ economies (Hirschman 1958). Therefore, investment in the key sectors of the economy like Social Overhead Capital (SOC) i.e., investments on social infrastructure often by the government, and complimentary Direct Productive Activities (DPA) made by private entrepreneurs, add to the flow of final goods and services that would automatically develop other sectors by ‘linkage effect’ which may bring about economies of scale. The approach of Jhinghan and Fasoranti (2016) have advocated strategic investment(s) that deliberately promote divergent series of effects evident in strategic and sustainable development of infrastructures.

Sturup and Low (2019) advance the approach to development to engender sustainability that is environmentally subjective despite being ascribed ‘externalities’ status akin to the Environmental Kuznets Curve (EKC) widely believed to explain the growth—environment relationship. This emphasizes that infrastructures, as a sustainable asset in development, may meet present needs and aspirations without necessarily meeting those of future generations; therefore limiting, yet not absolutely, the present socioeconomic and technological structures related to the environment.

2.3. Empirical review

Empirical assessments of the degree of infrastructures’ contribution to sustainable economic development display considerable dissimilarity in studies across developed and developing economies. Examining Cameroon’s experience, the work of Sama and Afuge (2016) on the implications of infrastructural development on Cameroon’s economic emergence, found that the class of economic infrastructure that includes telecommunication, transport, and energy (electricity) is most significant. Such infrastructure enhances the growth process, while education and health infrastructure such as hospitals, banks and schools promotes social welfare in terms of level of literacy, rate of primary school enrolment, and the level of financial inclusion.

In Nigeria, Osundina, Ebere and Osundina (2014) studied poverty reduction in Nigeria by examining the relationship between government spending, infrastructure and poverty in Nigeria using per capita income, government infrastructure spending on building and construction, transportation, education and health as variables in over forty three year by adopting Vector Error Correction model (VECM). Their findings showed a long run relationship between government spending, infrastructure and poverty reduction and advice intensive capital expenditure in order to ameliorate poverty in Nigeria.

Ogbaro and Omotoso (2017) examined The Impact of Infrastructure Development on Economic Growth in Nigeria using Cobb-Douglas production model and estimated through the ordinary least squares method. The study revealed that air transport, communication, power and rail lines infrastructures exerts positive and significant effects on economic growth, and recommends that Nigerian government should enable and encourage environment to implement policies like Public-Private Partnership geared towards the development of infrastructure. Kabiru (2016) found that infrastructure capital budget and spending adequacy in Nigeria has the greatest potential to stimulate socio-economic development since infrastructure facilities/services help to produce final consumption items for households and intermediate consumption items for firms.

Babatunde (2018) investigated government spending on infrastructure and economic growth in Nigeria. Using macroeconomic time series data on variables such as Gross Domestic Product, public spending on agriculture and natural resources, transport and communication, education and healthcare between 1980 and 2016, found that that only government spending on transport and communication, education and health infrastructure has significant long-term effects on economic growth. However Babatunde recommended government spending on infrastructure which ensures efficiency and equity in public governance.

Ewubare (2019) assessed the impact of economic planning on sustainable development in Nigeria with a focus on the impact of planned investments in economic, community and social services on poverty reduction and income inequality. The results revealed that basic measures of economic planning are mutually significant in forecasting sustainable development in Nigeria. The African Development Bank (2014) the African Union and the United Nations (2015) affirm that essential infrastructure needs like clean water and sanitation, access to affordable, reliable and modern energy services will support Africa’s accelerated integration and growth, technological transformation, trade and development.

All the studies reviewed focused on the broad relationship between infrastructure(s), environment and socioeconomic growth rather than a limited focus on sustainable development from a narrow economic perspective. They use a variety of analytical models and estimation techniques. However, none of studies focuses specifically on sustainable infrastructure(s) that can engender the required sustainable economic development in Nigeria. This creates a lack of decisive and adequate empirical information. This study intends to fill this gap and contribute to the emerging knowledge area of sustainable infrastructures and sustainable economic development in Nigeria.

3. Methodology

3.1. Theoretical framework and data sources

In order to achieve the objectives of this study, the qualitative analysis follow related literature that identified, examined and established the relationship between infrastructures, growth and development, and sustainability in Quantitative analysis adopted a production function model with the econometric model specification from the work of Iheanacho (2016) and Atolia et al. (2017) with modifications. Production function is adopted because it relates the physical quantity of inputs to outputs in any sector and thereby establishes the positive centrality of infrastructures to economic development in any economic system. This study framework is premised on emerging modelling of sustainable development pivoted on the trio of social, economic and environment processes of sustainability induced by physical development activities

The linear function specified for the framework is: (1) $$q=\mathrm{ }f\mathrm{ }\left(e\right)$$(1) where e = (K, L) as the input(s) in traditional production function defined as capital and labour and q as the output with assumption of constant returns to scale (CES).

For this study, Sustainable Economic Development as the endogenous variable is proxy by GDP per Capita (GDPc) as Q while K = capital factor input is proxy by infrastructure variables of (Electric Power Generated (EPG) Megawatts/hour (MWh) and Transport Public Capital Spending (PCE) and L= labour factor input modified and proxy by (Carbon (CO₂) from transport, electricity and heat production (percentage of total fuel combustion CTE) the exogenous variables. A standard log-linear transformation functional relationship was employed between endogenous and exogenous variables in order to stabilize the variance of the variables or avoid. Time series secondary data used for the study (EPG) and (CTE) are obtained from World Bank World Development Indicators while GDPc and PCE were obtained from the Central Bank of Nigeria (CBN) Statistical Bulletins and CBN Economic Reports spanning years 1990–2019.

3.2. Model specifications

The endogenous model often specified for testing or explaining the effects of the independent variables on the dependent variable are expressed in an estimation equation or function. The linear function specified for the estimation in this study is: (2) $$\text{Sustainable}\mathrm{ }\text{Economic}\mathrm{ }\text{Development}\mathrm{ }=f\left(\text{Environment}+\text{Economy}+\text{Social}+\mathrm{ }\text{Infrastructures}\right)$$(2) where Sustainable Economic Development is proxy by GDP per Capita (GDPc), Infrastructure = f Megawatts/hour (MWh) (EPG) and Transport Public Capital Spending (PCE), Environment = (CTE).

Then, the explicit model is mathematically expressed as follows; (3) $$\mathbf{GDPc}=f(\mathbf{CTE}+\text{EPG}+\text{PCE})$$(3)

The set of variables in this study was used because of their conjectural strong influence on sustainable economic development as qualitatively discussed, with respect to infrastructure development, environmental quality and sustainability nexus. The above function (3) is further transformed into an econometric model as follows: (4) $$\mathbf{GDPc}={\mathbf{\beta }}_{\mathbf{0}}+{\mathbf{\beta }}_{\mathbf{1}}\mathbf{C}\mathbf{TE}+{\mathbf{\beta }}_{\mathbf{2}}\mathbf{E}\mathbf{PG}+\mathrm{ }{\mathbf{\beta }}_3\text{PCE}+u_t$$(4) where: GDP per Capita (GDPc), Carbon dioxide (CO₂) from transport, electricity and heat production (percentage of total fuel combustion (CTE), and Electric Power Generated (EPG), Transport Public Capital Spending (PCE) while β₀ = Intercept term, β1 = Coefficient of CTE, β₂₌ Coefficient of EPG, β₃ = Coefficient of PCE and u_t = stochastic or disturbance term. On a priori grounds the various theoretical expectations explained above is β₀ − β₃>0

Furthermore, since the model variables are not in the same unit scale, this study specifies its model in a simple log-linear form by taking the partial natural logarithm of a variable in Eq. (4). This gives the function below. (5) $$\mathbf{Ln}\mathrm{ }\mathbf{GDPc}={\mathbf{\beta }}_{\mathbf{0}}+{\mathbf{\beta }}_{\mathbf{1}}\mathbf{C}\mathbf{T}{\mathbf{E}}_{\mathbf{t}-\mathbf{1}}+{\mathbf{\beta }}_{\mathbf{2}}{\text{EPG}}_{\mathrm{t}-1}+{\mathbf{\beta }}_3{\text{PCE}}_{\mathrm{t}-1}+e_t$$(5)

Equation (5) is the long-run relationship between sustainable economic development and infrastructure development.

3.3. Estimation technique

Before the structural analysis of the series variables was estimated, the estimation process for this study involved descriptive analysis and unit root test of the series data adopting only the Augmented Dickey Fuller (ADF) technique (at level and difference) to determine the trend and stationarity of the series using Eq. (6), as example for CTE at first difference. (6) $$\Delta {\text{CTE}}_{\mathrm{t}}=\mathrm{ }\mathrm{\mu }{+}_{\mathrm{\gamma }}{\text{CTE}}_{\mathrm{t}-1}+\mathrm{ }{\Sigma }_{\mathrm{\beta }}\Delta {\text{CTE}}_{\mathrm{t}}{-}_1+e_t$$(6) where the ADF regression tests for the existence of unit root of CTE_t (applicable to all other model variables) at time t. The null (and alternative) hypothesis that tests the existence of unit root in the variable CTEt is H₀:= 0 against H₁: ≠ 0.

Based on the unit root test result, co-integration analysis employing the Johansen test approach of the combined linear unrestricted Vector Error Correction Model (VECM) and Vector Autoregressive (VAR) at appropriate lag length of (1) was used, based on Schwarz criterion (SIC). The Johansen test approach is a type of ordinary least square model, useful and applicable to small sample sizes with stationarity time series at first order of integration I (1) to determine the long-run relationship between the economic variables.

To identify which infrastructure(s) need is critical to sustainable economic development between transport and electric power supply infrastructures, the study adopted the Granger causality test to determine the effect and direction of causality of the variables using the model equation (6)(6) $$\Delta {\text{CTE}}_{\mathrm{t}}=\mathrm{ }\mathrm{\mu }{+}_{\mathrm{\gamma }}{\text{CTE}}_{\mathrm{t}-1}+\mathrm{ }{\Sigma }_{\mathrm{\beta }}\Delta {\text{CTE}}_{\mathrm{t}}{-}_1+e_t$$(6) thus; (7) $${\mathrm{Y}}_t={\mathrm{ }\mathrm{\alpha }}_0+\Sigma {\mathrm{\delta }}_i\Delta {\mathrm{x}}_{t-i}+\Sigma {\epsilon }_j\Delta {\mathrm{z}}_{t-j}+e_{ti-j}$$(7) where Y_t, X_t and Z_t can assume the vector of any of the series variables alternatively and uncorrelated, and Granger-cause one another if their coefficients α_i, δ_i and Ԑ_j is not equal to zero and at an appropriate number of lags to give bi-directional situations where the conditions simultaneously exist, or unidirectional causality if either off the conditions occur at P-value less than 5 per cent significance. The post estimation diagnostic statistics tests of the series such as serial correlation, and cumulative sum of squares of recursive residuals for model variables were carried out to ascertain the reliability of the parameter estimates and found significant.

4. Results and discussions

Table 1 shows the ADF technique for the unit root test on the series data to examine their stationarity or otherwise at different orders of integration and critical value at 5 per cent level of significance to avoid spurious results in the model. The result shows that all the series are stationary at first difference indicating no existence of unit roots based on the condition that the absolute value of ADF is greater than t-statistic value at corresponding P-value less than 5 per cent significance. This result underscores estimation condition for using co-integration by way Johansen technique below. Co-integration test

Table 1. Unit root test—Augmented Dickey-Fuller (A.D.F.).

Variable	Level		1st Difference		Order of integration
	t-Stat	P-value	t-Stat	P-value
LNGDP/C	2.9670	0.8738	2.9710	0.0034	I(1)
CTE	2.9678	0.0708	2.9719	0.0000	I(1)
EPG	2.967767	0.99909	2.971853	0.0000	I(1)
PCE	2.976	0.1154	2.9918	0.0000	I(1)

Source: Author's Computation, 2021, t-Stat @ 5% significance.

Tables 2 and 3 below present the result of Johansen test for co-integration. It compared the unrestricted co-integration rank tests from the trace and maximum eigenvalue tests at 5 percent significance.

Table 2. Optimal lag length selection based on Schwarz information criterion (SIC) for cointegration test.

Lag	LogL	LR	FPE	AIC	SC	HQ
0	−15.17366	NA	0.242826	1.420271	1.612247	1.477356
1	11.64741	43.70843*	0.035938*	−0.492401*	−0.252431*	−0.421045*
2	12.01683	0.574647	0.037778	−0.445691	−0.157727	−0.360064

Source: Author’s computation, 2021. Note. LR = sequential modified LR test statistic; FPE = final prediction error; AIC = Akaike information criterion; SC = Schwarz information criterion; LogL = log likelihood; LR = likelihood ratio. * Indicates the lag suggested by each criterion.

From Table 2, the suggested lag is 1. Following from this, the next was to estimate the long-run relationship among the variables using Johansen technique as reported in Table 3.

Table 3. Unrestricted co-integration rank test (trace).

Hypothesized		Trace	0.05
No. of CE(s)	Eigenvalue	Statistic	Critical value	Prob.**
None	0.479795	34.48012	47.85613	0.4758
At most 1	0.366567	18.14180	29.79707	0.5556
At most 2	0.149044	6.726781	15.49471	0.6096
At most 3	0.102081	2.691898	3.841466	0.1009
Unrestricted Cointegration Rank Test (Maximum Eigenvalue)
Hypothesized	Eigenvalue	Max-Eigen	0.05	Prob.**
No. of CE(s)		Statistic	Critical Value
None	0.479795	16.33832	27.58434	0.6369
At most 1	0.366567	11.41501	21.13162	0.6059
At most 2	0.149044	4.034883	14.26460	0.8557
At most 3	0.102081	2.691898	3.841466	0.1009
1 Cointegrating Equation(s):		Log likelihood	−301.3211
Normalized cointegrating coefficients (standard error in parentheses)
LNGDPC	PCE	EPG	CTE
1.000000	0.011925	−0.001622	−0.140871
	(0.00655)	(0.00014)	(0.02933)

Source: Author’s computation, 2021.

From Table 3, both the trace and Max-Eigen statistic showed that there is no evidence of co-integration between the dependent and the independent variables at 5 percent significance levels, hence the null hypothesis that no cointegration occurs is accepted. Further, the normalized infrastructures development induced sustainable economic development equation shows the respective effect of the independent variables on the dependent variable. Both CTE and EPG exert an inelastic and significant impact on the lnGDPc, except PCE which exerts an elastic impact lnGDPc. All things being equal at long run, the finding infers that sustainable economic development is responsive to electric power supply (proxy by EPG) and the environment while transport infrastructure (proxy by PCE) is not impacting on sustainable economic development (proxy by lnGDPc). This is in tandem with the position of (Ogundipe and Apata 2013) that electricity consumption impacts significantly on growth and development while (Babatunde 2018) deploring poor public capital expenditure on critical infrastructures development, which in turn impacts on sustainable economic development in Nigeria.

4.1. Granger causality test

It shows the test results of causal associations and establishes the direction of their causal relationships among and between dependent (lnGDPr) and the independent variables (PCE, EPG, CTE) as show in Table 4.

Table 4. Pairwise Granger causality tests.

Null Hypothesis:	F-statistic	Prob.
PCE does not Granger cause LNGDPC	2.00264	0.1494
LNGDPC does not Granger cause PCE	1.92800	0.1616
EPG does not Granger cause LNGDPC	1.74283	0.1871
LNGDPC does not Granger cause EPG	0.66429	0.6253

Source: Author’s computation, 2021.

To obtain the second objective of the study which is to identify the direction of causal relationships among and between variables, EPG and PCE that proxy Electric Power supply and Transportation infrastructures and GDP per Capita are important. From the result, the pairs of variables i.e., EPG and PCE have neither bi-directional nor unidirectional causality with lnGDPc (i.e., the pair of variables have P-values greater than 0.05) meaning they are insignificant. Specifically, these indicate that neither transport nor electric power supply infrastructures support sustainable economic development in Nigeria despite their long run relationship. The result is contrary to the finding of Kabiru (2016) that strongly underscores the indispensability of transport infrastructure as catalyst for activating and stimulating the economic and social development in any society and that of Makwe, Akinwale, and Atoyebi (2012), Ogundipe and Apata (2013) and Akinkunmi (2017) that alluded to the economic importance of the energy sector—electric power supply—as the driving force of economic development in Nigeria.

Perhaps the reason for the study result is the long neglect of the two subsectors by government especially by not committing sufficient funds and resources largely due to paucity of available funds and inadequacy of budgetary provision (Fasoranti 2016) and the overall low electricity consumption estimated at 18–27 kWh per capita per month, or 90–135 kWh per month for an average household with five members.

In Table 5, Breusch-Godfrey Serial Correlation LM Test model was used for a serial correlation test. The Prob. Chi-Square value of (0.0003) obtained significance at @5% and shows that there is no problem of serial correlation in the model and hence reject the null-hypothesis of no auto correlation.

Table 5. Breusch-Godfrey serial correlation LM test.

F-statistic	1.237387	Prob. F(2,1)	0.5365
Obs*R-squared	16.38086	Prob. Chi-Square(2)	0.0003

5. Conclusion: policy recommendations and areas of further study

This study is essentially focused on infrastructure(s) for Nigeria’s sustainable economic development and seeks to examine the relationship between identified infrastructure(s) and sustainable economic development. It examined a plethora of relevant studies, and conceptual and empirical investigations that allude to the infrastructures in subsectors of transportation and energy (electric power supply) while recognizing that sustainable economic development hinges on local inclusiveness, economic progress and environmental friendliness. These studies support the theoretical bases for the study. The study revealed that despite electric power supply having a strong relationship with sustainable economic development, it, however, does not serve as catalyst for sustainable economic development.

It is recommended:

1. The Nigerian government should strategically focus on provision and investment in electric power supply as very critical economic infrastructure, which will in turn have linkage effects to boosting other economic sectors.

2. There is need to stimulate competition in economic infrastructures by harnessing private sector investment and inclusiveness models through clear policies and programmes.

3. In view of the findings of this study, transportation and energy (electric power supply) infrastructures are critical to sustainable economic development and must be invested into.

4. Since the parameters that preconditions unbalance growth and its intrinsic linkage effects in Nigeria’s economy, economic policy in this direction should be harnessed going forward.

Disclosure statement

No potential conflict of interest was reported by the author.