PreprintCited by 11Urban and Rural Development ChallengesHousing Market and EconomicsRegional Economics and Spatial Analysis

Roads to Development: Experimental Evidence from Urban Road Pavement

Open access
Gonzalez-Navarro, Marco, Quintana-Domeque, Climent·2010·SSRN Electronic Journal

Abstract

Urban peripheries in many developing country cities lack basic local public goods like pavement, water, sewerage and electricity. We estimate the impacts of slum infrastructure upgrading using an experiment in urban road pavement provision in Mexico. Our findings show that homes in streets that were paved increased their value between 15 and 17%. Households living in streets that were paved obtained more credit, had higher per capita expenditures, increased motor vehicle ownership and were more likely to have made home improvements. The rate of return to road pavement is estimated to be 2% without considering externalities, but raises to 55% once externalities are accounted for. We also present a model to understand the experimental estimates. Increases in consumption are more strongly correlated with increases in housing value than reductions in transport costs, suggesting that the wealth effect generated by the road pavement was a stronger driver of consumption than the reduction in transport costs.

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Crossref · 10.2139/ssrn.1558631

Cites

43 of 43 references verified0 citation errors · 0 not checkable

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  • One RCT (Gonzalez-Navarro 2010) incorporated randomisation into a government road paving intervention, offering an objective system of assigning the intervention where budgetary constraints prevented treatment of all communities identified as in need.

    “One RCT was able to incorporate randomisation into a government road paving intervention, offering an objective system of assigning the intervention where budgetary constraints prevented treatment of all the communities identified as in need (Gonzalez‐Navarro 2010).”
  • Risk of bias ranged from low to high for the main studies: one RCT (Gonzalez-Navarro 2010) was assigned low risk of bias (++), two CBAs (Galiani 2007; Soares 2005) were judged to have mixed or unclear bias (+), and two CBAs (Butala 2010; Taylor 1987) were considered to have high risk of bias (-).

    “Risk of bias ranged from low to high for the main studies. One RCT (Gonzalez‐Navarro 2010) was assigned a low risk of bias (++), two CBAs (Galiani 2007; Soares 2005) were judged to be have mixed or unclear bias (+) and two CBAs were considered to have a high risk of bias (‐) (Butala 2010; Taylor 1987).”
  • Among main studies, two projects were state-led government programmes: road paving (Gonzalez-Navarro 2010) and Favela-Barrio, which also received funding from the Inter-American Development Bank (Soares 2005).

    “Amongst the main studies two projects were state‐led government programmes, road paving (Gonzalez‐Navarro 2010) and Favela‐Barrio, which also received funding from the Inter‐American Development Bank (IADB) (Soares 2005).”
  • One RCT (Gonzalez-Navarro 2010) had low risk of selection bias due to random allocation and use of difference-in-differences analysis.

    “Within the five main studies, one RCT was identified as having a low risk of selection bias due to its random allocation and use of DiD analysis (Gonzalez‐Navarro 2010).”
  • Two further studies evaluated single physical interventions: one RCT (Gonzalez-Navarro 2010) evaluated road paving on parasite or fungus infections, sickness, and quality of life; one CBA (Galiani 2007) examined water supply on diarrhoea and water expenditure.

    “Two further studies evaluated the impact of single physical interventions: one RCT (Gonzalez‐Navarro 2010) evaluated the impact of road paving on parasite or fungus infections, sickness and quality of life; and one CBA examined the effect of water supply on diarrhoea and water expenditure (Galiani 2007).”

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Authors
Gonzalez-Navarro, M., & Quintana-Domeque, C.
Affiliations
University of California, Berkeley (US)
Venue
SSRN Electronic Journal
Publisher
Elsevier BV
Published
2010
ISSN
1556-5068 (ISSN-L)
OpenAlex
W154946084
Cited by
11
References
48
Citations by year
2018: 1 · 2017: 1 · 2016: 1 · 2015: 3 · 2014: 1 · 2013: 1
Type
posted content
Language
en
Open access
Locations
SSRN Electronic Journal (acceptedVersion)
Topics
  • Social Sciences › Urban Studies › Urban and Rural Development Challenges
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Housing Market and Economics
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Regional Economics and Spatial Analysis
Keywords
urban road pavement, urban periphery, local public goods, residential property values, externalities, transportation costs, wealth effects, household consumption, access to credit, car ownership, home improvement, developing cities

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