The Golden Quadrilateral Highway Project and Urban/Rural Manufacturing in India

This study investigates the impact of the Golden Quadrilateral highway project on the urban and rural growth of Indian manufacturing. The Golden Quadrilateral project upgraded the quality and width of 5,846 km of roads in India. The study uses a difference-in-difference estimation strategy to compare non-nodal districts based on their distance from the highway system. For the organized portion of the manufacturing sector, the Golden Quadrilateral project led to improvements in both urban and rural areas of non-nodal districts located 0-10 km from the Golden Quadrilateral. These higher entry rates and increases in plant productivity are not present in districts 10-50 km 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. The productivity consequences are similar in both locations. The most important difference appears to be the greater activation of urban areas near the nodal cities and rural areas in remote locations along the Golden Quadrilateral network. For the unorganized sector, no material effects are found from the Golden Quadrilateral 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.

Bibliographic Details

Main Authors:	Ghani, Ejaz, Goswami, Arti Grover, Kerr, William R.
Language:	en_US
Published:	World Bank, Washington, D.C. 2013-09
Subjects:	access roads, accounting, businesses, cities, connectivity, crossing, Development Economics, districts, driving, economic activity, economic conditions, Economic Growth, Economics, elasticity, electricity, employment, Enterprise Development, Enterprise Surveys, expressways, female, freight, freight movement, gender, Highway, Highway Congestion, highway construction, highway improvements, highway infrastructure, highway network, highway networks, Highway Project, highway projects, highway system, highway systems, Highways, Impact of Transport, impacts of transportation, implementations, Income, industrial development, industrialization, infrastructure projects, institution, international standards, Interstate Highway System, inventory, inventory management, labor markets, labor productivity, lanes, longer distances, Manufacturing, material, migration, movement of goods, national highways, open access, outputs, passenger traffic, population densities, productivity, productivity growth, Railroads, rents, results, road, Road Congestion, road network, Road transport, roads, rural area, rural areas, satellite, suburbs, suppliers, time frame, time frames, time period, traffic volume, Transport Infrastructure, transportation infrastructure, transportation networks, true, urban area, urban areas, urban land, urban planning, urbanization, uses, villages, Web, zoning,
Online Access:	http://hdl.handle.net/10986/16314
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