Gains from market integration: Welfare effects of new rural roads in Ethiopia

• 成果类型: Article
• 署名作者: Kebede, Hundanol A.
• 署名单位: Southern Illinois University System; Southern Illinois University
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2024.103252
• 发表日期: 2024
• 关键词: market integration; ricandian trade models; rural roads; Trade cost; URRAP

摘要

This paper estimates the welfare gains from the construction of rural roads that connect agricultural villages to market centers. I take theoretical predictions from Ricardian trade models to a rich high spatial resolution micro data on agricultural production from Ethiopia, which coincides with a period of extensive rural road construction. I estimate that the road construction resulted in an approximately 13% increase in real agricultural income, on average, and show that this increase is attributed to the mechanisms suggested in the Ricardian trade model: the prices of villages' comparative advantage crops increased, and villages reallocated land for these crops following decreases in trade costs.