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Spatial networks, labor supply, and income dynamics: Evidence from Indonesian villages

Author

Listed:
  • Yamauchi, Futoshi
  • Muto, Megumi
  • Chowdhury, Shyamal
  • Dewina, Reno
  • Sumaryanto, Sony

Abstract

"This paper uses household panel and village census data from Indonesia to examine the impact of spatial connectivity (road) development on household income growth and nonagricultural labor supply. The empirical results show that the impacts of improvements in local road quality (which positively correlate with transportation speed) on income growth and the transition to nonagricultural labor markets depend on the distance to economic centers and the household education level. In particular, postprimary education significantly increases the benefit from local spatial connectivity improvement in remote areas and promotes labor transition to nonagricultural sectors. Education and local road quality are complementary, mutually increasing income growth and nonagricultural labor income in remote areas. The gain from improvements in local connectivity (measured by average road quality) depends on village remoteness and initial household-level endowments." from authors' abstract

Suggested Citation

  • Yamauchi, Futoshi & Muto, Megumi & Chowdhury, Shyamal & Dewina, Reno & Sumaryanto, Sony, 2009. "Spatial networks, labor supply, and income dynamics: Evidence from Indonesian villages," IFPRI discussion papers 897, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:fpr:ifprid:897
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    References listed on IDEAS

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    Cited by:

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    2. Wong, Ho Lun & Luo, Renfu & Zhang, Linxiu & Rozelle, Scott, 2013. "Providing quality infrastructure in rural villages: The case of rural roads in China," Journal of Development Economics, Elsevier, vol. 103(C), pages 262-274.
    3. Sulser, T. B., 2009. "Green and blue water accounting in the Limpopo and Nile basins: implications for food and agricultural policy," IWMI Working Papers H042476, International Water Management Institute.
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    More about this item

    Keywords

    income growth; Spatial connectivity; Rural economy; Education; Social protection; Human capital;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General

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