Changes in Individual Economic Activities and Regional Market Structures Caused by Rural Road Improvements in Cambodia

Abstract

In rural areas of developing countries, most individuals engage in farming of staple foods and trading them in their local markets for daily earnings. If a road is improved, what would happen to those markets and the local populations’ economic activities? This study aimed to examine the effects of rural road improvements on local economic activities and market structures in rural areas of Cambodia using quantitative and qualitative data collected from face-to-face interviews. The data included both individual economic status and households’ travel behavior around their markets. This study showed that improving road conditions helps low-income individuals visit a market frequently and releases rice farmers from the time and cost burdens of transporting their rice to markets or enables customers to now approach them directly for trades. The enhancement of economic activities was also confirmed among local populations on the roadsides, particularly groups with economic capacities, and this effect was distributed to markets even beyond the roadsides. Our findings suggest that rural road improvements enhance the economic status of individuals who engage in dominant economic activities along the improved roads and that these benefits extend beyond roadside markets themselves. However, such positive impacts were not realized by households that did not own any land for rice farming and whose economic status remained poor. Instruments should be integrated into future rural road improvement projects to include households of small economic capacities in the local economic development process.