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Does Transportation Infrastructure Reduce Poverty? Evidence from the Free Federal Trunk Highway System in Mexico

Salgado Granados, Nayeli Noyolitzin LU (2015) EKHM52 20151
Department of Economic History
Abstract
This paper provides an exploratory analysis about the effect of transportation infrastructure on poverty reductions in Mexico between 1990 and 2010. Using the density of highways and unprecedented official estimations of poverty at municipality level, I show that this type of infrastructure lead to reductions in poverty. On average, for every additional kilometer (km) of highway (km/100km2) poverty decreases in 0.4 percentage points. When comparing areas by the concentration of native population, there is no difference in the effect of highways for indigenous and non-indigenous municipalities. In addition, the study reveals that highways have more influence on poverty in periods of economic contractions. In order to address the problem of... (More)
This paper provides an exploratory analysis about the effect of transportation infrastructure on poverty reductions in Mexico between 1990 and 2010. Using the density of highways and unprecedented official estimations of poverty at municipality level, I show that this type of infrastructure lead to reductions in poverty. On average, for every additional kilometer (km) of highway (km/100km2) poverty decreases in 0.4 percentage points. When comparing areas by the concentration of native population, there is no difference in the effect of highways for indigenous and non-indigenous municipalities. In addition, the study reveals that highways have more influence on poverty in periods of economic contractions. In order to address the problem of reverse causality in the placement of highways, this study applies a counterfactual proposed by Banerjee, Duflo and Qian (2012). Despite the efforts to determine causality of highways on poverty, the results have some limitations to be considered in future studies. (Less)
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author
Salgado Granados, Nayeli Noyolitzin LU
supervisor
organization
course
EKHM52 20151
year
type
H2 - Master's Degree (Two Years)
subject
keywords
poverty, highways, indigenous municipalities, Mexico, transportation infrastructure
language
English
id
5474207
date added to LUP
2015-06-25 12:28:23
date last changed
2015-06-25 12:28:23
@misc{5474207,
  abstract     = {This paper provides an exploratory analysis about the effect of transportation infrastructure on poverty reductions in Mexico between 1990 and 2010. Using the density of highways and unprecedented official estimations of poverty at municipality level, I show that this type of infrastructure lead to reductions in poverty. On average, for every additional kilometer (km) of highway (km/100km2) poverty decreases in 0.4 percentage points. When comparing areas by the concentration of native population, there is no difference in the effect of highways for indigenous and non-indigenous municipalities. In addition, the study reveals that highways have more influence on poverty in periods of economic contractions. In order to address the problem of reverse causality in the placement of highways, this study applies a counterfactual proposed by Banerjee, Duflo and Qian (2012). Despite the efforts to determine causality of highways on poverty, the results have some limitations to be considered in future studies.},
  author       = {Salgado Granados, Nayeli Noyolitzin},
  keyword      = {poverty,highways,indigenous municipalities,Mexico,transportation infrastructure},
  language     = {eng},
  note         = {Student Paper},
  title        = {Does Transportation Infrastructure Reduce Poverty? Evidence from the Free Federal Trunk Highway System in Mexico},
  year         = {2015},
}