Technical Working Paper 01-103

Infrastructure and Agricultural Production: Cross-Country Evidence and Implications for China, F. Felloni, T. Wahl, P. Wandschneider, and J. Gilbert January 2002

Abstract

This study uses cross-sectional data from 83 countries and 30 provinces in China to assess the effect of transportation infrastructure and electricity on agricultural production and productivity. Evidence from both data sets suggests that, in accordance with economic theory, the density of roads and the availability of electricity are significant predicators of production and productivity in agriculture.

These results are particularly interesting for China, where, in past 20 years, the increase in Chinese agricultural output, specialization and mobility in rural areas has been impressive. Results of the analysis suggest that access to transportation infrastructure and electricity will be crucial in the modernization of Chinese agriculture.