Political economy of road networks: What happens to a local economy when a new road is built?

The processes that involve the provision of public goods like paved streets, electricity, gas and piped water connections are highly contested and politicised in Pakistan. As a result, differences in the provision of public goods exist across dimensions of class, caste/biraderi, gender and locality. The differential and uneven provision of public goods, not only further perpetuates poverty and inequality in society, it also, reduces overall productivity of the economy. The differential provision of public goods is one of the key bottlenecks in materialising inclusive and sustainable economic development.

Some studies show that road networks in other countries have multiple positive externalities or ‘wider economic benefits’. In this study, the researchers will inquire what ‘wider economic benefits’ of building new road networks, at the level of local village/town economy, exist in Pakistan. This project will aim to analyse how the construction of new road networks effect and mediate existing gaps and differences in the provision of public goods in Pakistan.

The researchers will use a quasi-natural experiment setting in the Sheikhupura district of Punjab to analyse the impact of the construction of a motorway and linked roads on a local level. Through the use of a survey instrument and regression analysis, the researchers will collect data from select villages/town with varying distributions of land ownership among their residents.

It is important to note that in Punjab, differences in land ownership became highly pronounced under British colonial rule. In the ‘new institutional’ economics literature, contemporaneous uneven development outcomes are traced back to the institutions set up during colonial rule in countries like Pakistan. The researchers argue that this literature tends to deny agency to the postcolonial state to undo its colonial legacy.

By looking at the provision of public goods across villages with differences in both land ownership patterns and their locality in relation to the motorway, the researchers will aim to analyse how postcolonial state policy (the construction of motorway) effects and mitigates legacies of the historical British colonial rule in Punjab, Pakistan.

Given that the government of Pakistan faces significant resource constraints, policymakers should pursue such policies that accrue wider economic benefits and reduce socioeconomic inequities through infrastructure spending. The findings of this project aim to assist policymakers in identifying how they can maximise wider economic benefits and minimise inequities through infrastructure development.