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The Implications of the New Silk Road Railways on Local Development

Author

Listed:
  • Ling Fang
  • Martin Kleimann
  • Yuan Li
  • Hans-Jörg Schmerer

Abstract

This paper studies regional treatment effects of infrastructure projects on economic growth, employment and intermodal transport volumes. The recent Belt and Road Initiative provides an experiment that can be evaluated using matching econometrics. Our results show that the establishment of a new railway connection is not systematically associated with short-run economic growth. However, it spurs employment and road freight by stimulating intermodal transport.

Suggested Citation

  • Ling Fang & Martin Kleimann & Yuan Li & Hans-Jörg Schmerer, 2019. "The Implications of the New Silk Road Railways on Local Development," CESifo Working Paper Series 7923, CESifo.
    • Handle: RePEc:ces:ceswps:_7923
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    File URL: https://www.ifo.de/DocDL/cesifo1_wp7923.pdf
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    References listed on IDEAS

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    1. Alicia Garcia Herrero & Jianwei Xu, 2017. "China's Belt and Road Initiative: Can Europe Expect Trade Gains?," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 25(6), pages 84-99, November.
    2. Rietveld, Piet, 1989. "Infrastructure and Regional Development: A Survey of Multiregional Economic Models," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 23(4), pages 255-274.
    3. Xiaoyang Chen,Maggie & Lin,Chuanhao, 2018. "Foreign Investment across the Belt and Road : Patterns, Determinants, and Effects," Policy Research Working Paper Series 8607, The World Bank.
    4. Li, Yuan & Bolton, Kierstin & Westphal, Theo, 2016. "The effect of the New Silk Road railways on aggregate trade volumes between China and Europe," Working Papers on East Asian Studies 109/2016, University of Duisburg-Essen, Institute of East Asian Studies IN-EAST.
    5. Iacus, Stefano M. & King, Gary & Porro, Giuseppe, 2012. "Causal Inference without Balance Checking: Coarsened Exact Matching," Political Analysis, Cambridge University Press, vol. 20(1), pages 1-24, January.
    6. Randall W. Eberts & Joe A. Stone, 1992. "Wage and Employment Adjustment in Local Labor Markets," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number wea.
    7. Yuan Li & Kierstin Bolton & Theo Westphal, 2018. "The effect of the New Silk Road railways on aggregate trade volumes between China and Europe," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 16(3), pages 275-292, July.
    8. Stefano Iacus & Gary King & Giuseppe Porro, 2008. "Matching for Causal Inference Without Balance Checking," UNIMI - Research Papers in Economics, Business, and Statistics unimi-1073, Universitá degli Studi di Milano.
    9. Li, Han & Li, Zhigang, 2013. "Road investments and inventory reduction: Firm level evidence from China," Journal of Urban Economics, Elsevier, vol. 76(C), pages 43-52.
    10. Alberto Abadie & Guido W. Imbens, 2006. "Large Sample Properties of Matching Estimators for Average Treatment Effects," Econometrica, Econometric Society, vol. 74(1), pages 235-267, January.
    11. Kenneth Button, 1998. "original: Infrastructure investment, endogenous growth and economic convergence," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 32(1), pages 145-162.
    12. Alberto Abadie & David Drukker & Jane Leber Herr & Guido W. Imbens, 2004. "Implementing matching estimators for average treatment effects in Stata," Stata Journal, StataCorp LLC, vol. 4(3), pages 290-311, September.
    13. Douglas R. Dalenberg & Mark D. Partridge & Dan S. Rickman, 1998. "Public Infrastructure: Pork or Jobs Creator?," Public Finance Review, , vol. 26(1), pages 24-52, January.
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    Cited by:

    1. Yuan Li & Martin Kleimann & Hans-Jörg Schmerer, 2021. "Estimating causal effects of BRI infrastructure projects based on the synthetic control method," Asia Europe Journal, Springer, vol. 19(1), pages 103-129, December.

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    Keywords

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    JEL classification:

    • F00 - International Economics - - General - - - General
    • F15 - International Economics - - Trade - - - Economic Integration
    • F19 - International Economics - - Trade - - - Other

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