Rural Roads and Local Economic Development

This study estimates the impacts of India’s 40 billion USD national rural road construction programme

Abstract

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 USD 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.

This research is part of the Gender, Growth and Labour Markets in Low-Income Countries programme

Citation

Asher, Sam, and Paul Novosad. 2020. “Rural Roads and Local Economic Development.” American Economic Review, 110 (3): 797-823. DOI: 10.1257/aer.20180268

Rural Roads and Local Economic Development

Updates to this page

Published 31 March 2020