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Farther on down the road : transport costs, trade and urban growth in Sub-Saharan Africa

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  • Storeygard, Adam

Abstract

Transport costs are widely considered an important barrier to local economic activity but their impact in developing countries is not well-studied. This paper investigates the role of inter-city transport costs in determining the income of Sub-Saharan African cities, using two new data sources. Specifically, it asks how important access to a large port city is for the income of hinterland cities in 15 countries. Satellite data on lights at night proxy for city economic activity, and shortest routes between cities are calculated using new road network data. Cost per unit of distance is identified by world oil prices. The results show that an oil price increase of the magnitude experienced between 2002 and 2008 induces the income of cities near a major port to increase by 6 percent relative to otherwise identical cities 500 kilometers farther away. Cities connected to the port by paved roads are chiefly affected by transport costs to the port, while cities connected to the port by unpaved roads are more affected by connections to secondary centers. These are important findings for economic development in Sub-Saharan Africa since the majority of its population growth over the next few decades is expected to be in urban areas.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6444.

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Date of creation: 01 May 2013
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Handle: RePEc:wbk:wbrwps:6444

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Keywords: Transport Economics Policy&Planning; Rural Roads&Transport; Subnational Economic Development; E-Business; Roads&Highways;

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  7. Eric Strobl & Luisito Bertinelli & Salvador Barrios, . "Climatic Change and Rural-Urban Migration: The Case of Sub-Saharan Africa," Working Papers on International Economics and Finance 06-01, FEDEA.
  8. Jeremy Atack & Fred Bateman & Michael Haines & Robert A. Margo, 2009. "Did Railroads Induce Or Follow Economic Growth? Urbanization And Population Growth In The American Midwest, 1850-60," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series, Boston University - Department of Economics dp-178, Boston University - Department of Economics.
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  12. Vivien Foster & Cecilia Briceno-Garmendia, 2010. "Africa's Infrastructure : A Time for Transformation," World Bank Publications, The World Bank, number 2692, August.
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  14. Gallup, J.L. & Sachs, J.D. & Mullinger, A., 1999. "Geography and Economic Development," Papers, Chicago - Graduate School of Business 1, Chicago - Graduate School of Business.
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  16. Supee Teravaninthorn & Gaël Raballand, 2009. "Transport Prices and Costs in Africa : A Review of the International Corridors," World Bank Publications, The World Bank, number 6610, August.
  17. Fay, Marianne & Opal, Charlotte, 2000. "Urbanization without growth : a not-so-uncommon phenomenon," Policy Research Working Paper Series 2412, The World Bank.
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Cited by:
  1. Monica Beuran & Marie Castaing Gachassin & Gaël Raballand, 2013. "Are There Myths on Road Impact and Transport in Sub-Saharan Africa?," Documents de travail du Centre d'Economie de la Sorbonne, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne 13049, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
  2. Stephen J. Redding & Matthew A. Turner, 2014. "Transportation Costs and the Spatial Organization of Economic Activity," CEP Discussion Papers dp1277, Centre for Economic Performance, LSE.
  3. David von Below & Pierre-Louis Vezina, 2013. "The Trade Consequences of Pricey Oil," OxCarre Working Papers, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford 115, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.

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