EXPRESSWAYS AND POVERTY REDUCTION: EVIDENCE FROM RURAL CHINA

Abstract

Combining rural household data and China’s expressway network, this paper estimates the causal effect of expressway access on rural household income using propensity score matching and difference-in-differences method. Our empirical results showed that access to expressways does not, on average, benefit rural households, but further evidence revealed a heterogeneous effect. Improved expressway access can promote poor rural households’ per capita net income by 23.0%, in comparison to the non-poor. Supporting evidence suggests that expressway access encourages rural–urban migration, especially for the poor rural workers, which ultimately leads to higher income for this group. These findings highlight the effects of expressway access on the reduction of rural poverty.