Highways and Spatial Location within Cities
The authors investigate the impact of the golden quadrilateral (GQ) highway project on the spatial organization and efficiency of manufacturing activity. The GQ project upgraded the quality and width of 3,633 miles of roads in India. The authors use a difference-in-difference estimation strategy to compare non-nodal districts based upon their distance from the highway system. For the organized portion of the manufacturing sector, we find that GQ led to improvements in both urban and rural areas of non-nodal districts located 0 to 10 kilometers from GQ. These higher entry rates and increases in plant productivity are not present in districts 10 to 50 kilometers away. The entry effects are stronger in rural areas of districts, but the differences between urban and rural areas are modest relative to the overall effect. For the unorganized sector, we do not find material effects from the GQ upgrades in either setting. These findings suggest that in the time frames that we can consider the first five to seven years during and after upgrades, the economic effects of major highway projects contribute modestly to the migration of the organized sector out of Indian cities but are unrelated to the increased urbanization of the unorganized sector.
| Main Authors: | , , |
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| Format: | Journal Article biblioteca |
| Language: | English |
| Published: |
Published by Oxford University Press on behalf of the World Bank
2016-04-10
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| Subjects: | ROADS, HIGHWAY NETWORK, SPATIAL ECONOMICS, BUSINESS CLUSTER, INFRASTRUCTURE INVESTMENT, FIRM ENTRY, FIRM PRODUCTIVITY, URBANIZATION, |
| Online Access: | http://documents.worldbank.org/curated/en/911911565607517844/Highways-and-Spatial-Location-within-Cities-Evidence-from-India http://hdl.handle.net/10986/32235 |
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| Summary: | The authors investigate the impact of
the golden quadrilateral (GQ) highway project on the spatial
organization and efficiency of manufacturing activity. The
GQ project upgraded the quality and width of 3,633 miles of
roads in India. The authors use a difference-in-difference
estimation strategy to compare non-nodal districts based
upon their distance from the highway system. For the
organized portion of the manufacturing sector, we find that
GQ led to improvements in both urban and rural areas of
non-nodal districts located 0 to 10 kilometers from GQ.
These higher entry rates and increases in plant productivity
are not present in districts 10 to 50 kilometers away. The
entry effects are stronger in rural areas of districts, but
the differences between urban and rural areas are modest
relative to the overall effect. For the unorganized sector,
we do not find material effects from the GQ upgrades in
either setting. These findings suggest that in the time
frames that we can consider the first five to seven years
during and after upgrades, the economic effects of major
highway projects contribute modestly to the migration of the
organized sector out of Indian cities but are unrelated to
the increased urbanization of the unorganized sector. |
|---|