{"title":"Chinese roads in India: The effect of transport infrastructure on economic development","authors":"Simon Alder","doi":"10.1016/j.jinteco.2025.104140","DOIUrl":null,"url":null,"abstract":"<div><div>India and China followed different strategies in the design of their recent highway networks. India first focused on connecting the four largest economic centers of the country, the Golden Quadrilateral, while China had the explicit strategy of connecting intermediate-sized cities. This paper analyzes the aggregate and distributional effects of transport infrastructure in India based on a general equilibrium trade framework. I compare the effect of the Golden Quadrilateral to a counterfactual network that connects India’s intermediate-sized cities. To construct the counterfactual network, I propose a heuristic network design algorithm to maximize aggregate real income net of road construction costs in the general equilibrium model, and I show that the heuristic algorithm provides a good approximation of the optimal network. The results suggest that the actual network led to sizable aggregate gains but unequal effects across regions. The income-maximizing counterfactual network is substantially larger than the actual Indian network, would imply further aggregate gains, and would benefit the lagging regions of India.</div></div>","PeriodicalId":16276,"journal":{"name":"Journal of International Economics","volume":"157 ","pages":"Article 104140"},"PeriodicalIF":4.0000,"publicationDate":"2025-08-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of International Economics","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S0022199625000972","RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 0
Abstract
India and China followed different strategies in the design of their recent highway networks. India first focused on connecting the four largest economic centers of the country, the Golden Quadrilateral, while China had the explicit strategy of connecting intermediate-sized cities. This paper analyzes the aggregate and distributional effects of transport infrastructure in India based on a general equilibrium trade framework. I compare the effect of the Golden Quadrilateral to a counterfactual network that connects India’s intermediate-sized cities. To construct the counterfactual network, I propose a heuristic network design algorithm to maximize aggregate real income net of road construction costs in the general equilibrium model, and I show that the heuristic algorithm provides a good approximation of the optimal network. The results suggest that the actual network led to sizable aggregate gains but unequal effects across regions. The income-maximizing counterfactual network is substantially larger than the actual Indian network, would imply further aggregate gains, and would benefit the lagging regions of India.
期刊介绍:
The Journal of International Economics is intended to serve as the primary outlet for theoretical and empirical research in all areas of international economics. These include, but are not limited to the following: trade patterns, commercial policy; international institutions; exchange rates; open economy macroeconomics; international finance; international factor mobility. The Journal especially encourages the submission of articles which are empirical in nature, or deal with issues of open economy macroeconomics and international finance. Theoretical work submitted to the Journal should be original in its motivation or modelling structure. Empirical analysis should be based on a theoretical framework, and should be capable of replication.