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Title: On the Road: Access to Transportation Infrastructure and Economic Growth in China

Author(s): Abhijit Banerjee, Esther Duflo and Nancy Qian

Publication Date: March 2012

Keyword(s): firms, growth, inequality and infrastructure

Programme Area(s): Development Economics

Abstract: This paper estimates the effect of access to transportation networks on regional economic outcomes in China over a twenty-period of rapid income growth. It addresses the problem of the endogenous placement of networks by exploiting the fact that these networks tend to connect historical cities. Our results show that proximity to transportation networks have a moderate positive causal effect on per capita GDP levels across sectors, but no effect on per capita GDP growth. We provide a simple theoretical framework with empirically testable predictions to interpret our results. We argue that our results are consistent with factor mobility playing an important role in determining the economic benefits of infrastructure development.

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Bibliographic Reference

Banerjee, A, Duflo, E and Qian, N. 2012. 'On the Road: Access to Transportation Infrastructure and Economic Growth in China'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=8874