Does public infrastructure lead or lag GDP? evidence from Thailand based on NARDL

It is usually recognized that public infrastructure is an important ingredient for economic growth. What is not clear, however, is the leader-follower relationship between them. This paper is focused on whether the infrastructure leads GDP or the other way around. Thailand is used as a case study. The methods used are the ARDL and nonlinear ARDL. The nonlinear ARDL analysis indicates that the cointegrating relationship between the two variables is nonlinear and that the relationship is asymmetric in both the short and long run. Furthermore, the findings based on variance decomposition analysis tend to indicate that infrastructure drives GDP and not the other way around. These findings appear to be intuitive and contain strong policy implications for the decision makers in an emerging economy like Thailand.