Rural Roads and Local Economic Development

Сельские дороги и местное экономическое развитие
Sam Asher, Paul Novosad
2020-02-28

Indiaagricultural employmentfuzzy regression discontinuitylocal economic developmentrural road construction
Nearly one billion people worldwide live in rural areas without access to national paved road networks. We estimate the impacts of India’s $40 billion national rural road construction program using a fuzzy regression discontinuity design and comprehensive household and firm census microdata. Four years after road construction, the main effect of new feeder roads is to facilitate the movement of workers out of agriculture. However, there are no major changes in agricultural outcomes, income, or assets. Employment in village firms expands only slightly. Even with better market connections, remote areas may continue to lack economic opportunities. (JEL J43, O13, O18, R23, R42)
1
Employment in village firms expanded only slightly following improved road access.
2
Four years after feeder-road construction, the primary effect was increased movement of workers out of agriculture.
3
Improved market connectivity alone may not generate substantial economic opportunities in remote rural areas.
4
India’s $40 billion national rural road program was evaluated using a fuzzy regression discontinuity design and comprehensive household and firm census microdata.
5
New roads produced no major changes in agricultural outcomes, household income, or asset ownership.

India’s national rural road construction program and the new feeder roads it constructed in rural areas

The impacts of new feeder roads on rural labor movement, agricultural outcomes, income, assets, village-firm employment, and local economic opportunities

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2020-02-28
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Sam Asher
Paul Novosad
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