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Does Aid for Roads Attract Foreign or Domestic Firms? Evidence from C ambodia
Author(s) -
Tanaka Kiyoyasu,
Tsubota Kenmei
Publication year - 2013
Publication title -
the developing economies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.305
H-Index - 30
eISSN - 1746-1049
pISSN - 0012-1533
DOI - 10.1111/deve.12027
Subject(s) - business , negative binomial distribution , census , distribution (mathematics) , population , demographic economics , economics , statistics , mathematical analysis , demography , mathematics , sociology , poisson distribution
Less developed countries have received substantial foreign aid for transport infrastructure, making its quantitative assessment important. To investigate the effect of aid for road infrastructure on the location of foreign and domestic firms, this study employs the first comprehensive census on all business establishments in C ambodia for 2011 and measures the geographical distribution of aid disbursements in roads. Estimating a negative binomial model, we find that aid disbursements in roads have little influence on the entry of foreign and domestic firms across communes. Compared with the aid effect, the location of firms is more strongly influenced by other determinants such as population size, electricity access, and labor supply.