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From Battlefield to Marketplace: Legacies, Highways and Polycentric Development in Vietnam

Author

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  • Manabu Nose

    (Keio University, Faculty of Economics)

  • Yasuyuki Sawada

    (University of Tokyo, Faculty of Economics, Graduate School of Economics)

Abstract

Why do transport investments induce polycentric industrial growth in specific instances, rather than reinforcing existing cores? By investigating large-scale Greater Mekong Subregion highway projects in Northern Vietnam, where postwar state-led reconstruction restored monocentric urban structure following wartime devastation, this paper shows that later corridor investments generated nonlinear, polycentric industrial growth. Improved market access induced large manufacturing entry in agrarian peripheries, with effects amplified by local supply-chain depth. A spatial general equilibrium model with input-output linkages replicates this mechanism. The corridor raised income but widened spatial inequality, a trade-off mitigated by feeder-road complementarity. Infrastructure acts as a spatial big push only when connectivity and production networks jointly trigger new clusters. Overall, a structural shift from monocentric battlefield resilience to polycentric market expansion is catalyzed by infrastructure investments. *Revised DP2025-010

Suggested Citation

  • Manabu Nose & Yasuyuki Sawada, 2026. "From Battlefield to Marketplace: Legacies, Highways and Polycentric Development in Vietnam," Keio-IES Discussion Paper Series DP2026-014, Institute for Economics Studies, Keio University.
    • Handle: RePEc:keo:dpaper:dp2026-014
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    JEL classification:

    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning

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