Exploring Infrastructure as a Catalyst for Firm-Level Sales Outcomes: A Study from Pakistan

Abstract

This study investigates how financial, physical, and institutional infrastructure collectively shape firm performance in Pakistan. Despite increasing global recognition of infrastructure's role in economic development, Pakistan industrial sector, continue to face challenges in leveraging infrastructure to optimize firm performance. Adopting firm-level microdata from the World Bank Enterprise Surveys (WBES) 2022 and employing rigorous econometric analysis, the study captures the potentially dynamic relationships of three infrastructure types and firm performance. Our findings strongly support the notion that firm age, foreign ownership, quality certification, and infrastructure are key determinants of higher sales, while managerial time spent on regulatory compliance can negatively impact growth. The results indicate that a holistic strategy encompassing several infrastructure attributes yields the highest firm-level effects. To promote greater firm-level performance and overall economic growth in Pakistan, authorities must prioritise integrated plans that take into consideration these crucial interdependencies, as well as solve specific infrastructural inadequacies.