Dams

Esther Duflo and Rohini Pande

No 11711, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The construction of large dams is one of the most costly and controversial forms of public infrastructure investment in developing countries, but little is known about their impact. This paper studies the productivity and distributional effects of large dams in India. To account for endogenous placement of dams we use GIS data and the fact that river gradient affects a district's suitability for dams to provide instrumental variable estimates of their impact. We find that, in a district where a dam is built, agricultural production does not increase but poverty does. In contrast, districts located downstream from the dam benefit from increased irrigation and see agricultural production increase and poverty fall. Overall, our estimates suggest that large dam construction in India is a marginally cost-effective investment with significant distributional implications, and has, in aggregate, increased poverty.

JEL-codes: O21 O12 H43 H23 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev, nep-ene and nep-env
Date: 2005-10
Note: PE
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Related works:
Working Paper: Dams (2005)
Working Paper: Dams (2005)
Journal Article: Dams (2007)
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