The Impact of Road Development on Household Welfare in Rural Papua New Guinea

Tinbergen Institute Discussion Paper No. 17-076/V

33 Pages Posted: 22 Aug 2017

See all articles by Martin Wiegand

Martin Wiegand

VU University Amsterdam

Eric Koomen

VU University Amsterdam - Department of Spatial Economics

Menno Prasad Pradhan

Vrije Universiteit Amsterdam, School of Business and Economics; University of Amsterdam - Faculty of Economics and Business (FEB)

Christopher Edmonds

Tokyo International University

Date Written: July 18, 2017

Abstract

In this paper we estimate the impact of road development on household welfare in rural Papua New Guinea over the period between 1996 and 2010, using two cross-sectional household surveys and corresponding road maps. To deal with endogenous placement of road infrastructure programs we employ a correlated random effects model that corrects for location-specific changes in road quality. We also use a newly developed quantile regression method to investigate whether road works are pro-poor. Estimates show that investments in sealing roads to nearest towns led to higher consumption levels and housing quality, and to less reliance on subsistence farming. Effects are stronger among poor, less educated, and female-led households.

Keywords: roads, infrastructure, impact evaluation, household welfare, developing country, Papua New Guinea

JEL Classification: H54, O18

Suggested Citation

Wiegand, Martin and Koomen, Eric and Pradhan, Menno and Edmonds, Christopher, The Impact of Road Development on Household Welfare in Rural Papua New Guinea (July 18, 2017). Tinbergen Institute Discussion Paper No. 17-076/V, Available at SSRN: https://ssrn.com/abstract=3021792 or http://dx.doi.org/10.2139/ssrn.3021792

Martin Wiegand (Contact Author)

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, ND North Holland 1081 HV
Netherlands

Eric Koomen

VU University Amsterdam - Department of Spatial Economics ( email )

De Boelelaan 1105
1081HV Amsterdam
Netherlands

Menno Pradhan

Vrije Universiteit Amsterdam, School of Business and Economics ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands
+31(0)20 444 6137 (Phone)
+31(0)20 444 6127 (Fax)

University of Amsterdam - Faculty of Economics and Business (FEB) ( email )

Roetersstraat 11
Amsterdam, 1018 WB
Netherlands

Christopher Edmonds

Tokyo International University ( email )

United States

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