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Abstract
Laos is a mountainous country with poor roads and a high rate of
poverty incidence, especially in rural areas. It is obvious that better
roads could reduce poverty, but by how much? And what forms of
road improvement reduce poverty the most? The economic effects of
road improvement are complex and multi-channeled. This paper uses
a multi-household general equilibrium modeling approach to study
these issues. The results indicate that road improvement does reduce
poverty but that the quantitative impact depends heavily on the types
of road that are provided and the areas in which the road is located.