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 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)
Highlights
Notes: This table presents regression discontinuity estimates from the main estimating equation of the effect of new road construction on village shares of all dummy variables used in the consumption prediction exercise
For the purposes of this paper, all variables are aggregated to the level of the census village, the geographic unit at which we measure outcomes
As no comprehensive village-level data is collected on agricultural production in India, we use two commonly-used and closely related vegetative indices (VIs) to proxy for agricultural production in baseline and endline survey periods: the normalized difference in vegetation index (NDVI) and the enhanced vegetation index (EVI), which is very similar but uses additional information from the blue part of the electromagnetic spectrum
Summary
Notes: This table presents regression discontinuity estimates from the main estimating equation of the effect of new road construction on the share of village households with landholdings in a given range. Notes: This table presents regression discontinuity estimates from the main estimating equation of the effect of new road construction on village shares of all dummy variables used in the consumption prediction exercise (except for number of rooms, which is the village mean). Notes: This table presents regression discontinuity estimates from the main estimating equation of the effect of a new road on indices of the major outcomes in each of the five families of outcomes: transportation, occupation, firms, agriculture and welfare. Notes: This table presents regression discontinuity estimates from the main estimating equation of the effect of a new road on outcomes in nearby villages. Householdlevel variables are wall material, roof material, house ownership, dwelling room count, salaried job, payment of income tax, ownership of registered enterprise, monthly income, source of income, asset ownership (refrigerator, telephone, vehicle, mechanized farm equipment, irrigation equipment, Kisan credit card), and land ownership
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