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The Babeldaob Road: The Impact of Road Construction on Rural Labor Force Outcomes in the Republic of Palau

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  • Akee, Randall K. Q.

    (Brookings Institution)

Abstract

This research examines the impact of road construction on rural labor force outcomes in a developing country. A new road built in the Republic of Palau links formerly inaccessible rural areas to more urban wage sector employment. We use two censuses conducted five years apart which perfectly bracket the road construction period. The data allow us to identify households that moved in the intervening five year period, thereby correcting any endogenous movement attributable to the road construction. Utilizing a difference-in-difference regression strategy and matched panel data, we find that households impacted by the new road construction tend to increase their wage sector employment, decrease their self-employment in agriculture, decrease the number of international migrants sent abroad and increase their ownership of automobiles. The findings also show that inequality decreases both within and between regions. The impact of road construction on average household wages and income is negligible.

Suggested Citation

  • Akee, Randall K. Q., 2006. "The Babeldaob Road: The Impact of Road Construction on Rural Labor Force Outcomes in the Republic of Palau," IZA Discussion Papers 2452, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp2452
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    References listed on IDEAS

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    Cited by:

    1. Ritika Jain & Shreya Biswas, 2021. "The road to safety- Examining the nexus between road infrastructure and crime in rural India," Papers 2112.07314, arXiv.org.
    2. Taryn Dinkelman, 2011. "The Effects of Rural Electrification on Employment: New Evidence from South Africa," American Economic Review, American Economic Association, vol. 101(7), pages 3078-3108, December.
    3. Céline Nauges & Jon Strand, 2017. "Water Hauling and Girls’ School Attendance: Some New Evidence from Ghana," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(1), pages 65-88, January.

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    More about this item

    Keywords

    infrastructure; economic development; rural labor force;
    All these keywords.

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R29 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Other
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General

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