Transport Infrastructure and Welfare : An Application to Nigeria

Transport infrastructure is deemed to be central to development and consumes a large fraction of the development assistance envelope. Yet there is debate about the economic impact of road projects. This paper proposes an approach to assess the diff...

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Main Authors: Ali, Rubaba, Barra, Alvaro Federico, Berg, Claudia N., Damania, Richard, Nash, John, Russ, Jason
Format: Working Paper
Language:English
en_US
Published: World Bank, Washington, DC 2015
Subjects:
CAR
GDP
Online Access:http://documents.worldbank.org/curated/en/2015/05/24498118/transport-infrastructure-welfare-application-nigeria
http://hdl.handle.net/10986/22004
id okr-10986-22004
recordtype oai_dc
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
en_US
topic LIVING STANDARDS
SANITATION
FORECASTS
TOTAL REVENUE
FREIGHT SERVICES
PRICE OF FUEL
INCOME
INTEREST
VEHICLE SPEED
EXPECTATIONS
TRANSPORT INFRASTRUCTURE
PUBLIC ROAD
URBAN ROAD
TRANSPORTATION COSTS
ROUND TRIP
FREIGHT TRANSPORT
TRANSPORT INFRASTRUCTURES
EXPORTS
ELASTICITY
ECONOMIC STRUCTURE
WELFARE
TRAVEL SPEED
VARIABLES
IMPACT OF TRANSPORT COSTS
HIGHWAY SYSTEM
ROAD INFRASTRUCTURE
ROUTES
WEALTH
TRANSPORT SERVICES
TRANSPORT INVESTMENT
TRANSPORTATION INFRASTRUCTURE
ROAD TYPE
TRAVEL COSTS
DEVELOPMENT
ECONOMIC ACTIVITY
VEHICLE
INFLUENCE
TRANSPORT INVESTMENTS
ROAD
COSTS
DEVELOPMENT ECONOMICS
INFRASTRUCTURE REFORM
MAXIMUM LIKELIHOOD ESTIMATION
ROAD NETWORK
ECONOMIC BENEFITS
TRANSPORT
IMPACT OF TRANSPORT
INTERSTATE HIGHWAY SYSTEM
COST ELASTICITIES
PRODUCTIVITY
INDUSTRIALIZATION
MARKETS
TRUE
HIGHWAY IMPROVEMENT
LENGTH OF ROAD
TRANSPORT FACILITIES
ROAD IMPROVEMENT
TRAVEL TIMES
RURAL ROADS
GROSS DOMESTIC PRODUCT
CAPITAL INVESTMENTS
INVENTORY
ROUTE
ROAD QUALITY
INFRASTRUCTURE
SUSTAINABLE TRANSPORT
PRODUCTIVITY GROWTH
HUMAN CAPITAL
ROAD TYPES
OPPORTUNITY COST
TRAVEL
TRANSPORTATION
ECONOMIC PERFORMANCE
WAGES
MODE OF TRANSPORTATION
CARS
VALUE
CREDIT
ELASTICITIES
INFRASTRUCTURE REHABILITATION
ACCESSIBILITY
DIRECT ROUTES
AGRICULTURE
ECONOMIC EFFICIENCY
DECISION MAKING
MEASUREMENT
BENCHMARK
INFRASTRUCTURE PROJECTS
ROAD PROJECTS
HIGHWAYS
ECONOMIC THEORY
HIGHWAY INFRASTRUCTURE
ROAD USER
REGRESSION ANALYSIS
ROADS
CAR
WALKING
HIGHWAY ADMINISTRATION
HIGHWAY
TRADE
RAILWAYS
TRAVEL DISTANCE
GDP
VEHICLE COST
GOODS
THEORY
TRANSPORTATION COST
INVESTMENT
AGGLOMERATION ECONOMIES
RAILROADS
FUEL
TRIP
REVENUE
INVESTMENTS
UNDERESTIMATES
STATISTICAL ANALYSIS
ROAD INVESTMENT
ECONOMIC GEOGRAPHY
URBAN ROADS
DEVELOPMENT PROJECTS
TRANSPORT COSTS
OUTCOMES
ROAD TRANSPORT
TRAVEL TIME
HIGHWAY CAPITAL
FUEL COST
FREIGHT
INFRASTRUCTURES
BENEFITS
DEVELOPMENT POLICY
spellingShingle LIVING STANDARDS
SANITATION
FORECASTS
TOTAL REVENUE
FREIGHT SERVICES
PRICE OF FUEL
INCOME
INTEREST
VEHICLE SPEED
EXPECTATIONS
TRANSPORT INFRASTRUCTURE
PUBLIC ROAD
URBAN ROAD
TRANSPORTATION COSTS
ROUND TRIP
FREIGHT TRANSPORT
TRANSPORT INFRASTRUCTURES
EXPORTS
ELASTICITY
ECONOMIC STRUCTURE
WELFARE
TRAVEL SPEED
VARIABLES
IMPACT OF TRANSPORT COSTS
HIGHWAY SYSTEM
ROAD INFRASTRUCTURE
ROUTES
WEALTH
TRANSPORT SERVICES
TRANSPORT INVESTMENT
TRANSPORTATION INFRASTRUCTURE
ROAD TYPE
TRAVEL COSTS
DEVELOPMENT
ECONOMIC ACTIVITY
VEHICLE
INFLUENCE
TRANSPORT INVESTMENTS
ROAD
COSTS
DEVELOPMENT ECONOMICS
INFRASTRUCTURE REFORM
MAXIMUM LIKELIHOOD ESTIMATION
ROAD NETWORK
ECONOMIC BENEFITS
TRANSPORT
IMPACT OF TRANSPORT
INTERSTATE HIGHWAY SYSTEM
COST ELASTICITIES
PRODUCTIVITY
INDUSTRIALIZATION
MARKETS
TRUE
HIGHWAY IMPROVEMENT
LENGTH OF ROAD
TRANSPORT FACILITIES
ROAD IMPROVEMENT
TRAVEL TIMES
RURAL ROADS
GROSS DOMESTIC PRODUCT
CAPITAL INVESTMENTS
INVENTORY
ROUTE
ROAD QUALITY
INFRASTRUCTURE
SUSTAINABLE TRANSPORT
PRODUCTIVITY GROWTH
HUMAN CAPITAL
ROAD TYPES
OPPORTUNITY COST
TRAVEL
TRANSPORTATION
ECONOMIC PERFORMANCE
WAGES
MODE OF TRANSPORTATION
CARS
VALUE
CREDIT
ELASTICITIES
INFRASTRUCTURE REHABILITATION
ACCESSIBILITY
DIRECT ROUTES
AGRICULTURE
ECONOMIC EFFICIENCY
DECISION MAKING
MEASUREMENT
BENCHMARK
INFRASTRUCTURE PROJECTS
ROAD PROJECTS
HIGHWAYS
ECONOMIC THEORY
HIGHWAY INFRASTRUCTURE
ROAD USER
REGRESSION ANALYSIS
ROADS
CAR
WALKING
HIGHWAY ADMINISTRATION
HIGHWAY
TRADE
RAILWAYS
TRAVEL DISTANCE
GDP
VEHICLE COST
GOODS
THEORY
TRANSPORTATION COST
INVESTMENT
AGGLOMERATION ECONOMIES
RAILROADS
FUEL
TRIP
REVENUE
INVESTMENTS
UNDERESTIMATES
STATISTICAL ANALYSIS
ROAD INVESTMENT
ECONOMIC GEOGRAPHY
URBAN ROADS
DEVELOPMENT PROJECTS
TRANSPORT COSTS
OUTCOMES
ROAD TRANSPORT
TRAVEL TIME
HIGHWAY CAPITAL
FUEL COST
FREIGHT
INFRASTRUCTURES
BENEFITS
DEVELOPMENT POLICY
Ali, Rubaba
Barra, Alvaro Federico
Berg, Claudia N.
Damania, Richard
Nash, John
Russ, Jason
Transport Infrastructure and Welfare : An Application to Nigeria
geographic_facet Africa
Nigeria
relation Policy Research Working Paper;No. 7271
description Transport infrastructure is deemed to be central to development and consumes a large fraction of the development assistance envelope. Yet there is debate about the economic impact of road projects. This paper proposes an approach to assess the differential development impacts of alternative road construction and prioritize various proposals, using Nigeria as a case study. Recognizing that there is no perfect measure of economic well-being, a variety of outcome metrics are used, including crop revenue, livestock revenue, non-agricultural income, the probability of being multi-dimensionally poor, and local gross domestic product for Nigeria. Although the measure of transport is the most accurate possible, it is still endogenous because of the nonrandom placement of road infrastructure. This endogeneity is addressed using a seemingly novel instrumental variable termed the natural path: the time it would take to walk along the most logical route connecting two points without taking into account other, bias-causing economic benefits. Further, the analysis considers the potential endogeneity from nonrandom placement of households and markets through carefully chosen control variables. It finds that reducing transportation costs in Nigeria will increase crop revenue, non-agricultural income, the wealth index, and local gross domestic product. Livestock sales increase as well, although this finding is less robust. The probability of being multi-dimensionally poor will decrease. The results also cast light on income diversification and structural changes that may arise. These findings are robust to relaxing the exclusion restriction. The paper also demonstrates how to prioritize alternative road programs by comparing the expected development impacts of alternative New Partnership for Africas Development projects.
format Working Paper
author Ali, Rubaba
Barra, Alvaro Federico
Berg, Claudia N.
Damania, Richard
Nash, John
Russ, Jason
author_facet Ali, Rubaba
Barra, Alvaro Federico
Berg, Claudia N.
Damania, Richard
Nash, John
Russ, Jason
author_sort Ali, Rubaba
title Transport Infrastructure and Welfare : An Application to Nigeria
title_short Transport Infrastructure and Welfare : An Application to Nigeria
title_full Transport Infrastructure and Welfare : An Application to Nigeria
title_fullStr Transport Infrastructure and Welfare : An Application to Nigeria
title_full_unstemmed Transport Infrastructure and Welfare : An Application to Nigeria
title_sort transport infrastructure and welfare : an application to nigeria
publisher World Bank, Washington, DC
publishDate 2015
url http://documents.worldbank.org/curated/en/2015/05/24498118/transport-infrastructure-welfare-application-nigeria
http://hdl.handle.net/10986/22004
_version_ 1764449888597180416
spelling okr-10986-220042021-04-23T14:04:06Z Transport Infrastructure and Welfare : An Application to Nigeria Ali, Rubaba Barra, Alvaro Federico Berg, Claudia N. Damania, Richard Nash, John Russ, Jason LIVING STANDARDS SANITATION FORECASTS TOTAL REVENUE FREIGHT SERVICES PRICE OF FUEL INCOME INTEREST VEHICLE SPEED EXPECTATIONS TRANSPORT INFRASTRUCTURE PUBLIC ROAD URBAN ROAD TRANSPORTATION COSTS ROUND TRIP FREIGHT TRANSPORT TRANSPORT INFRASTRUCTURES EXPORTS ELASTICITY ECONOMIC STRUCTURE WELFARE TRAVEL SPEED VARIABLES IMPACT OF TRANSPORT COSTS HIGHWAY SYSTEM ROAD INFRASTRUCTURE ROUTES WEALTH TRANSPORT SERVICES TRANSPORT INVESTMENT TRANSPORTATION INFRASTRUCTURE ROAD TYPE TRAVEL COSTS DEVELOPMENT ECONOMIC ACTIVITY VEHICLE INFLUENCE TRANSPORT INVESTMENTS ROAD COSTS DEVELOPMENT ECONOMICS INFRASTRUCTURE REFORM MAXIMUM LIKELIHOOD ESTIMATION ROAD NETWORK ECONOMIC BENEFITS TRANSPORT IMPACT OF TRANSPORT INTERSTATE HIGHWAY SYSTEM COST ELASTICITIES PRODUCTIVITY INDUSTRIALIZATION MARKETS TRUE HIGHWAY IMPROVEMENT LENGTH OF ROAD TRANSPORT FACILITIES ROAD IMPROVEMENT TRAVEL TIMES RURAL ROADS GROSS DOMESTIC PRODUCT CAPITAL INVESTMENTS INVENTORY ROUTE ROAD QUALITY INFRASTRUCTURE SUSTAINABLE TRANSPORT PRODUCTIVITY GROWTH HUMAN CAPITAL ROAD TYPES OPPORTUNITY COST TRAVEL TRANSPORTATION ECONOMIC PERFORMANCE WAGES MODE OF TRANSPORTATION CARS VALUE CREDIT ELASTICITIES INFRASTRUCTURE REHABILITATION ACCESSIBILITY DIRECT ROUTES AGRICULTURE ECONOMIC EFFICIENCY DECISION MAKING MEASUREMENT BENCHMARK INFRASTRUCTURE PROJECTS ROAD PROJECTS HIGHWAYS ECONOMIC THEORY HIGHWAY INFRASTRUCTURE ROAD USER REGRESSION ANALYSIS ROADS CAR WALKING HIGHWAY ADMINISTRATION HIGHWAY TRADE RAILWAYS TRAVEL DISTANCE GDP VEHICLE COST GOODS THEORY TRANSPORTATION COST INVESTMENT AGGLOMERATION ECONOMIES RAILROADS FUEL TRIP REVENUE INVESTMENTS UNDERESTIMATES STATISTICAL ANALYSIS ROAD INVESTMENT ECONOMIC GEOGRAPHY URBAN ROADS DEVELOPMENT PROJECTS TRANSPORT COSTS OUTCOMES ROAD TRANSPORT TRAVEL TIME HIGHWAY CAPITAL FUEL COST FREIGHT INFRASTRUCTURES BENEFITS DEVELOPMENT POLICY Transport infrastructure is deemed to be central to development and consumes a large fraction of the development assistance envelope. Yet there is debate about the economic impact of road projects. This paper proposes an approach to assess the differential development impacts of alternative road construction and prioritize various proposals, using Nigeria as a case study. Recognizing that there is no perfect measure of economic well-being, a variety of outcome metrics are used, including crop revenue, livestock revenue, non-agricultural income, the probability of being multi-dimensionally poor, and local gross domestic product for Nigeria. Although the measure of transport is the most accurate possible, it is still endogenous because of the nonrandom placement of road infrastructure. This endogeneity is addressed using a seemingly novel instrumental variable termed the natural path: the time it would take to walk along the most logical route connecting two points without taking into account other, bias-causing economic benefits. Further, the analysis considers the potential endogeneity from nonrandom placement of households and markets through carefully chosen control variables. It finds that reducing transportation costs in Nigeria will increase crop revenue, non-agricultural income, the wealth index, and local gross domestic product. Livestock sales increase as well, although this finding is less robust. The probability of being multi-dimensionally poor will decrease. The results also cast light on income diversification and structural changes that may arise. These findings are robust to relaxing the exclusion restriction. The paper also demonstrates how to prioritize alternative road programs by comparing the expected development impacts of alternative New Partnership for Africas Development projects. 2015-06-02T21:28:30Z 2015-06-02T21:28:30Z 2015-05 Working Paper http://documents.worldbank.org/curated/en/2015/05/24498118/transport-infrastructure-welfare-application-nigeria http://hdl.handle.net/10986/22004 English en_US Policy Research Working Paper;No. 7271 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Africa Nigeria