Connective Financing - Chinese Infrastructure Projects and the Diffusion of Economic Activity in Developing Countries
CESifo, Munich, 2020
CESifo Working Paper No. 8344
![](https://cesifo.org/DocImg/cesifo1_wp8344.jpg?c=1689236854)
This paper studies the causal effect of transport infrastructure on the spatial distribution of economic activity within subnational regions in a large number of developing countries. To do so, we introduce a new global dataset of geolocated Chinese development finance projects over the period from 2000 to 2014 and combine it with measures of spatial concentration based on remotely-sensed data. We find that Chinese-financed transportation projects reduce spatial concentration within regions. Transport projects decentralize economic activity particularly strongly in regions that are more urbanized, located closer to a city, and less developed.
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Public Choice
Fiscal Policy, Macroeconomics and Growth