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Infrastructure Development

Definition

Infrastructure development refers to the process of constructing essential facilities like roads, bridges, airports, and power plants that support economic activity within a region or country. It plays a crucial role in promoting productivity, trade, and overall economic growth.

Analogy

Think of infrastructure development as building blocks that form the foundation of a city or town. Without strong blocks (infrastructure), it becomes challenging for people (economic activity) to move around efficiently and for businesses (buildings) to operate smoothly.

Related terms

Public Goods: Public goods are non-excludable and non-rivalrous commodities provided by governments, such as public parks or national defense.

Investment: Investment refers to allocating resources into assets with an expectation of generating future income or profit. In the case of infrastructure development, it involves spending on long-term projects to enhance economic capabilities.

Multiplier Effect: The multiplier effect refers to the concept that an initial increase in spending results in a larger increase in overall economic activity. In the context of infrastructure development, it suggests that investments in infrastructure can have broader positive effects on employment and income levels.