Road Network Centralization, Political Institutions, and Conflict

We study how the topology of road networks affects political institutions and the incidence of conflict. Using a global geo-coded data set of roads and cities, we first compute the degree of road network centralization for each country. This measure captures the disproportionate centrality of a few cities in a country's road network. We also use the slope of the terrain as a determinant of the network's bilateral paths and travel times. We then relate the network centralization measures to three sets of political and economic outcomes: (i) fiscal centralization variables such as the central government's share of total government revenue and expenditures relative to local and state governments; (ii) the incidence of internal conflicts, and (iii) political fragmentation measured by the prevalence of regional political parties. Our preliminary results show that countries with a more centralized road network tend to have a larger central government share in their overall government finances. Furthermore, higher centralization is associated with more internal conflict and a more regionally-fragmented political system. The evidence suggests that the configuration of the road network across a country's cities shapes its institutional characteristics and affects key political outcomes.