Theoretically, the net effect of road-building programmes on demographic transition is ambiguous. Improvements in road connectivity can facilitate the expansion of public and private transport services (Asher and Novosad 2020), and potentially improve households’ access to formal health care. Access to rural roads can thus reduce infant mortality by facilitating both institutional deliveries and immunisation among children (Aggarwal 2021).
Importantly, a decline in infant mortality could, in turn, further reduce fertility, as it becomes relatively easier for households to attain their desired family size (Kalemli-Ozcan 2003). This suggests that better road infrastructure can impact both fertility decisions and infant mortality, thereby likely hastening the pace of demographic transition.
A contrasting channel on fertility could also be at work: if improvements in infrastructure induce an economic upturn and raise household incomes (Lenz et al.2017), this could incentivise households to have more children as childcare becomes more affordable. There is evidence from both developed (Sobotka et al. 2011) and developing countries (Adsera and Menendez 2011) that fertility declines during economic downturns, with a corresponding increase during periods of economic growth. Therefore, the total effect of these mechanisms on the rate of demographic transition remains an open empirical question.
In a recent paper (Dasgupta et al. 2024), my co-authors and I make use of the variation in the paved roads in India arising from the Pradhan Mantri Gram Sadak Yojana (PMGSY) to study how road access impacts fertility decisions and investments in child health. Launched in 2000, the PMGSY is a large-scale road construction programme aimed at providing paved roads to previously unconnected habitations within Indian villages, prioritising those above specific population cutoffs. We use the distribution of village populations – the fraction of villages in any given region that lie above the relevant population cutoff at the baseline – as an instrument for actual road construction. This measure, in conjunction with rich administrative data, helps us examine the effects of rural roads on demographic transition and the potential mechanisms involved.
We find that the provision of paved roads enhances households’ access to healthcare facilities, increases immunisation rates among children, and reduces infant mortality. Importantly, we find that fertility falls in response to the improvements in road connectivity, which is consistent with previous studies (Kalemli-Ozcan 2003, Ranganathan et al. 2015). What is interesting is that fertility falls despite the decline in female employment following road construction, while male employment increases.
Interestingly, we do not find any change in the use of contraceptives, although historically this has been a dominant mechanism through which other infrastructure interventions, such as electrification (Grimm et al. 2015) and televisions (Tasciotti et al. 2022), have reduced fertility.
We obtained data on road construction from the Socioeconomic High-Resolution Rural–Urban Geographic Platform for India (SHRUG), a collection of data sets that encompass economic, demographic, and electoral indicators at the village and town levels. Additionally, we use the National Family and Health Survey (NFHS) for child health care and health outcome data, namely NFHS-4 (2015–2016) and NFHS-5 (2019–2021). We focused on NFHS-4, which covers over 500,000 households across the country and is representative at the district level. NFHS-4 contains questions on fertility, child and maternal mortality, family planning, immunisation, nutrition, and access to institutional care.
Strikingly, we find that road provision leads to a decline in fertility by as much as 5% of the mean. This seems to be driven primarily by a roughly equivalent decline in infant mortality, which can reduce uncertainty around child survival and decrease household demand for additional children (Adsera and Menendez 2011).
From a policy perspective, the effects of rural roads on child health care provide evidence for positive social externalities. These benefits are likely to compound over time because better health translates into improved educational attainment (Alderman et al. 2006, Bobonis et al. 2006), and labour supply (Baird et al.2016), which has implications for both spatial and intergenerational mobility (Ahlburg 1998). Furthermore, our findings suggest that rural roads have the potential to hasten the demographic transition as improvements in the ‘quality’ of children through reduced mortality and increased health investments coincide with lower fertility. Importantly, the benefits are not just limited to the demand side of healthcare; our findings suggest that rural roads improve households’ access to formal health care and hence help resolve the supply-side constraints in the last-mile delivery of health inputs for children.
Editors' note: This column is published in collaboration with the International Economic Associations’ Women in Leadership in Economics initiative, which aims to enhance the role of women in economics through research, building partnerships, and amplifying voices.
References
Adsera, A and A Menendez (2011), “Fertility changes in Latin America in periods of economic uncertainty”, Population Studies 65(1): 37–56.
Aggarwal, S (2018), “Do rural roads create pathways out of poverty? Evidence from India”, Journal of Development Economics 133: 375-395.
Ahlburg, D (1998), “Intergenerational transmission of health”, The American Economic Review 88(2): 265–270.
Alderman, H, J Hoddinott and B Kinsey (2006), “Long term consequences of early childhood malnutrition”, Oxford Economic Papers 58(3): 450–474.
Asher, S and P Novosad (2020), “Rural roads and local economic development”, American Economic Review 110(3): 797–823.
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