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On the Road: Access to Transportation Infrastructure and Economic Growth in China

  • Abhijit Banerjee
  • Esther Duflo
  • Nancy Qian

This paper estimates the effect of access to transportation networks on regional economic outcomes in China over a twenty-period of rapid income growth. It addresses the problem of the endogenous placement of networks by exploiting the fact that these networks tend to connect historical cities. Our results show that proximity to transportation networks have a moderate positive causal effect on per capita GDP levels across sectors, but no effect on per capita GDP growth. We provide a simple theoretical framework with empirically testable predictions to interpret our results. We argue that our results are consistent with factor mobility playing an important role in determining the economic benefits of infrastructure development.

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File URL: http://www.nber.org/papers/w17897.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 17897.

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Date of creation: Mar 2012
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Handle: RePEc:nbr:nberwo:17897
Note: EFG PR
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  1. Esther Duflo, 2002. "The Medium Run Effects of Educational Expansion: Evidence from a Large School Construction Program in Indonesia," NBER Working Papers 8710, National Bureau of Economic Research, Inc.
  2. Yaohui Zhao, 1999. "Leaving the Countryside: Rural-to-Urban Migration Decisions in China," American Economic Review, American Economic Association, vol. 89(2), pages 281-286, May.
  3. Allen J. Scott, 2009. "World Development Report 2009: reshaping economic geography," Journal of Economic Geography, Oxford University Press, vol. 9(4), pages 583-586, July.
  4. Edward L. Glaeser & Joshua D. Gottlieb, 2009. "The Wealth of Cities: Agglomeration Economies and Spatial Equilibrium in the United States," Journal of Economic Literature, American Economic Association, vol. 47(4), pages 983-1028, December.
  5. Mohsin S. Khan & Zuliu Hu, 1996. "Why is China Growing so Fast?," IMF Working Papers 96/75, International Monetary Fund.
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  7. repec:cup:cbooks:9780521291897 is not listed on IDEAS
  8. Dave Donaldson, 2010. "Railroads of the Raj: Estimating the Impact of Transportation Infrastructure," NBER Working Papers 16487, National Bureau of Economic Research, Inc.
  9. Meng, Xin, 2005. "Introduction: Poverty and labor markets in China," Journal of Comparative Economics, Elsevier, vol. 33(4), pages 641-643, December.
  10. Guy Michaels, 2006. "The Effect of Trade on the Demand for Skill - Evidence from the Interstate Highway System," CEP Discussion Papers dp0772, Centre for Economic Performance, LSE.
  11. Holtz-Eakin, Douglas & Newey, Whitney & Rosen, Harvey S, 1988. "Estimating Vector Autoregressions with Panel Data," Econometrica, Econometric Society, vol. 56(6), pages 1371-95, November.
  12. Wolfgang Keller & Carol H. Shiue, 2008. "Institutions, Technology, and Trade," NBER Working Papers 13913, National Bureau of Economic Research, Inc.
  13. 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," NBER Working Papers 14640, National Bureau of Economic Research, Inc.
  14. Feenstra, Robert C, 2002. "Border Effects and the Gravity Equation: Consistent Methods for Estimation," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(5), pages 491-506, December.
  15. Fogel, Robert William, 1962. "A Quantitative Approach to the Study of Railroads in American Economic Growth: A Report of Some Preliminary Findings," The Journal of Economic History, Cambridge University Press, vol. 22(02), pages 163-197, June.
  16. Fang Cai, 2010. "Chinese Rural Reform in 30 Years: An Analysis in Terms of Institutional Economics," Frontiers of Economics in China, Higher Education Press, vol. 5(1), pages 150-168, March.
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