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Market Access and Firm Performance: Evidence Based on GIS Analysis of Road Network and Manufacturing-Plant-Level Data from India

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Listed:
  • Sharma, Somnath

    (Asian Development Bank Institute)

  • Kant, Shashi

    (Asian Development Bank Institute)

  • Mishra, Ranjeeta

    (Asian Development Bank Institute)

  • Azhgaliyeva, Dina

    (Asian Development Bank Institute)

Abstract

We investigate whether better access to markets through an improved road network plays a role in improving firm profitability in India. We construct a district-level market access index using shapefiles of India's road network, district boundaries, and nightlight raster images and estimate the shortest driving distances for districts using the road network. Using the annual survey of industries data for India during 2001–2015, we show that market access through improved road connectivity resulted in a lower dispersion of ROA between 2001 and 2015 in India.

Suggested Citation

  • Sharma, Somnath & Kant, Shashi & Mishra, Ranjeeta & Azhgaliyeva, Dina, 2022. "Market Access and Firm Performance: Evidence Based on GIS Analysis of Road Network and Manufacturing-Plant-Level Data from India," ADBI Working Papers 1351, Asian Development Bank Institute.
    • Handle: RePEc:ris:adbiwp:1351
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    References listed on IDEAS

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    More about this item

    Keywords

    India; road infrastructure; firm productivity; market access index; electricity deficit; road length;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures

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