The effects of geography and infrastructure on economic development and international business involvement

The objective of this article is to bring together geographic, marketing and economic perspectives to examine how far infrastructure development can offset adverse national geographies in aiding economic development and involvement in the global economy. We use LISREL structural equation modelling to investigate relationships between geography, infrastructure, economic development and country’s involvement in trade and foreign direct investment. Results identify key geographic factors affecting global market involvement and key infrastructures (electricity production, telephone lines and container facilities at ports) facilitating economic development and international participation. JEL Classification: C30 (multiple or simultaneous equation models, multiple variables), O19 (international linkages in development), Q32 (exhaustible resources and economic development), R40 (transportation systems