The long-term causal effect of U.S. bombing missions on economic development: Evidence from the Ho Chi Minh Trail and Xieng Khouang Province in Lao P.D.R

Abstract

This study investigates the long-term causal effects of U.S. bombing missions during the Vietnam War on later economic development in Laos. Following an instrumental variables approach, we use the distance between the centroid of village-level administrative boundaries and heavily bombed targets, namely, the Ho Chi Minh Trail in southern Laos and Xieng Khouang Province in northern Laos, as an instrument for the intensity of U.S. bombing missions. We use three datasets of mean nighttime light intensity (1992, 2005, and 2013) and two datasets of population density (1990 and 2005) as outcome variables. The estimation results show no robust long-term effects of U.S. bombing missions on economic development in southern Laos but show negative effects in northern Laos, even 40 years after the war. We also found that the results do not necessarily support the conditional convergence hypothesis within a given country, although this result could be unique to Laos.