The impact of transportation infrastructure development on green total factor productivity in Belt and Road countries

This study seeks to assess the impact of transportation infrastructure on Green Total Factor Productivity (GTFP) and examine the role of the Belt and Road Initiative (BRI) in shaping GTFP across 50 participating countries between 2001 and 2021. Using a non-radial, non-oriented Slacks-Based Measure (SBM) combined with the Directional Distance Function (DDF) to measure GTFP. The panel data regression results reveal that road and rail transportation infrastructure's impact on GTFP is positive and significant across BRI countries. However, the findings from the two-step GMM model reveal that the road transportation infrastructure development negatively impact on GTFP following BRI agreements. This means BRI failed to restrain the improvement in GTFP through road transportation infrastructure development, proving the pollution shelter effect. Further, heterogeneity results indicate that there is a positive significant relation between railway developments and GTFP except in lower-middle income countries while road development is negative and significant towards GTFP in upper-middle-income countries. These findings emphasise the need for policymakers to reinforce the sustainability dimensions of foreign capital inflows institutionally within BRI countries to offset emission level driven by road transportation infrastructure development, especially in upper-middle income countries. Therefore, policy implications for participating countries in the green BRI necessitate prioritising the reallocation of resources towards green innovation in transportation infrastructure.