Better Roads, Better Off? Evidence on Upgrading Roads in Tanzania
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Published by Oxford University Press on behalf of the World Bank
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Spatial isolation is considered to be
one of the main determinants of poverty. Therefore, many
transport investments are undertaken with the stated
objective of poverty reduction. This paper evaluates the
effect of a Tanzanian program that rehabilitated 2,500 km of
major roads on rural livelihoods. The analysis uses a large
set of variables describing household behavior to provide a
complete picture of the adjustments. The identification
combines a household fixed effects strategy with propensity
score matching. Some damaging effects of the program are
found on the rural population in the two years following the
intervention: the price of rice decreases; households
reallocate labor away from agriculture and provide more wage
work, but the increase in wage income does not compensate
for the loss in agricultural income. Nor do households seem
to be benefiting from the fall in the price of rice at the
consumption level. These results are consistent with rural
households facing increased competition due to reduced
transportation costs.
Palabras clave
ROADS, POVERTY, RURAL HOUSEHOLDS, AFRICA