Financial inclusion, human capital development, infrastructure investment and economic development in Uganda

Abstract

This research aimed at investigating the impact of financial inclusion, human capital development, and infrastructure investment on economic development in Uganda. The study focused on assessing the impact of financial inclusion on economic development in Uganda, evaluating the effect of human capital development on economic development in Uganda and to examining the contribution of infrastructure investment on economic development in Uganda. The study employed a correlational research design research with a quantitative study approach which involved collecting secondary data from 2004-2023 from world development indicators. Data was analyzed using the statistical package for social science (SSPS Version 27). The study revealed that Financial inclusion composed of financial knowledge, usage and access, infrastructure investment and human capital development affects Economic development in Uganda. Financial knowledge, with a significant positive effect, underscores the importance of enhancing financial literacy to boost economic outcomes. Improving financial access is crucial, as it strongly impacts economic growth by broadening access to essential financial services. Although financial usage has a smaller effect, promoting its effective use still contributes to economic advancement. Human capital development emerges as the most impactful factor, emphasizing the need for investment in education and skills training to drive economic progress. Additionally, infrastructure investment, while less influential, remains important for supporting economic activities. Overall, a comprehensive strategy that integrates these elements is essential for fostering sustained economic development in Uganda. Therefore, the study recommends that governments should expand microfinance programs in underserved areas to improve access to financial services and economic stability. It also recommends targeted educational programs for low-income households, women, and youth to enhance financial literacy. Governments should boost budgets for education and health sectors to improve human capital and align education and health services with labor market needs. Additionally, investments in essential infrastructure, such as water supply, sanitation, electricity, and transportation, are crucial for economic growth and improved living standards. The study is limited to Uganda's financial inclusion, human capital development and infrastructure development, uses secondary data from 2004-2023