Topic Videos

Economic Importance of Infrastructure

AS, A-Level, IB
AQA, Edexcel, OCR, IB, Eduqas, WJEC

Last updated 1 Aug 2018

A short revision video on the importance of infrastructure spending for both aggregate demand and long run aggregate supply. Economic growth places rising demand on a country's infrastructure assets and the UK is ranked only 28th out of 138 countries globally for the perceived quality of our transport, telecoms, power and other critical infrastructure.

Economic Importance of Infrastructure

What is infrastructure?

  • Spending on new sewers, roads, wind farms, telecommunications networks and ports by both the private and the public sector
  • Infrastructure investment is vital for sustainable economic growth and research shows that the UK lags behind its major competitors in the quality of its infrastructure assets.
  • Infrastructure projects tend to have large upfront costs and benefits that add up over many years
  • Demands on infrastructure such as roads, railway, waste management, energy will rise along with economic growth and a growing population
  • Infrastructure needs to be resilient to cope with the effects of rapid urbanization and climate change. According to the World Bank, over the next 35 years, urban populations are estimated to expand by an additional 2.5 billion people — almost double the population of China.

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