Impacts of international transport infrastructure: Evidence from Laotian households

Abstract

This study investigates the impact of international transport infrastructure on household living standards. Specifically, we explore how an international bridge between Laos and Thailand affects Laotian households. We use the change in the share of food expenditure out of total expenditure as an indicator of improved living standards via infrastructure. Our estimation results generated through difference-in-differences analysis and propensity score matching show that establishing an international bridge decreased the share of food expenditure, suggesting that the living standards of households close to the bridge improved. Our main results are robust to alternative treatment measurements. Finally, we explore the heterogeneity of treatment effects using a machine learning approach and find that, while households with younger heads are likely to benefit more from the bridge, almost all households in districts close to it can benefit.