This paper reviews evidence on the effect of investment in rural infrastructure on market access, trade and in particular agricultural trade, and on conditions and complementarities pertaining to the maximisation of the benefit to agricultural development and poverty reduction.
Agriculture constitutes an important part of most low-income countries’ economies and is generally the primary source of income in rural areas, both directly through crop production and indirectly through on-farm and off-farm employment in agriculture-related industries.
The issue of the importance of improving rural infrastructure, and in particular rural roads, is not new in the development community. This topic has long been at the centre of development policies, supported by the popular assumption among development theorists that remote areas’ disadvantageous position vis-à-vis economic opportunity and social welfare could be remedied with road building. Investments in rural infrastructure were considered to have important positive effects on agricultural production and trade, and governments and donors invested heavily in the development of rural roads and transport corridors. Yet – perhaps because the importance of such infrastructure for development seemed so obvious – there has for some time been little formal evidence on how and under what conditions roads benefited rural households and agricultural development.