1. Adam Storeygard, Tufts University
Transport costs and city growth across sub-Saharan Africa: short- and long-run estimates
Adam Storeygard, Tufts University

2. Challenges of impact evaluation
General
Counterfactual is unobserved: what would have happened in absence of program
Treated region may be different from others for many reasons:
Omitted variables
Reverse causality
Project built to accommodate a region expected to grow
Project built to help a region expected to lag
Large infrastructure projects
Spatial scale of impacts unclear (potentially large)
Harder to find a good counterfactual/control group

3. Project 1: interannual transport costs and city growth
Key ideas
Many African countries have a large coastal city
Largest domestic market
Gateway to rest of world
Other cities need to trade with it
Transport cost to it is critical
Transport cost = distance * cost/distance
Proxy for cost/distance with oil price
Proxy for city economic activity with nighttime lights
Limited alternative city-specific outcome data for a large number of cities

5. oil price increase of $72/barrel (~2002-2008)
Results
oil price increase of $72/barrel (~ )
Cities near port grow by 7 percent relative to cities 500 km further away
Suggests elasticity of city economic activity with respect to transport costs of at 500 km
If transport costs  by 10%, city economic activity by 2.5 % (relative to other cities in same country)
Cities connected to port by paved roads are chiefly affected by transport costs to the port
Less connected cities more affected by connections to secondary cities

6. Project 2: road-building and long run city growth (w/Jedwab)
Key ideas
Digitized all Michelin road maps for sub-Saharan Africa
Define a city’s market access as the ease with which its firms/residents can travel to all other cities (weighted by their population)
Better roads increase market access
Better roads near a city might be endogenous
Instrument for a city’s overall Δ(market access) with Δ(market access) based only on roads built far away
Population as long-run outcome

8. Elasticity of 5% to 20% depending on instrument (radius of exclusion)
Preliminary results
Elasticity of 5% to 20% depending on instrument (radius of exclusion)
Larger than naïve OLS estimates of 3-4%
Doubling market access increases population by 5-20%
Some evidence it is urbanization, not displacement from other (nearby) cities
Effect spread over 30 years
Suggestion of larger effects for smaller, more remote cities

9. Evaluation of transport projects requires careful consideration of
Conclusions
Some evidence that transport costs matter for the growth of African cities
Evaluation of transport projects requires careful consideration of
Relevant counterfactuals
Omitted variables
Reverse causality
Some experiments, quasi-experiments possible
Random paving in Mexico
Policy rules in India, Sierra Leone