IFAD Research Series 95: Roadway to Growth - The Role of Infrastructure and Grants in Improving Livelihoods in Rural Montenegro

Giuseppe Maggio and Vibhuti Mendiratta

No 410373, IFAD Research Series from International Fund for Agricultural Development (IFAD)

Abstract: Do integrated interventions that simultaneously reduce market-access and capital constraints generate larger benefits than infrastructure investments alone? We study the effects of a bundled rural development program in northern Montenegro combining infrastructure investment and matching grants. Exploiting geographic discontinuities in program assignments and employing both regression discontinuity and inverse-probability-weighted regression adjustment (IPWRA) estimators, we find that treated households experienced significant increases in production and market participation. We show that the combination of road improvements and matching grants yields a broader set of effects than infrastructure alone, suggesting that the two interventions generate complementary effects by simultaneously unlocking physical access and relaxing liquidity constraints. Our results highlight the importance of jointly addressing market connectivity and credit access in rural development strategies.

Keywords: Agribusiness; Community/Rural/Urban Development (search for similar items in EconPapers)
Pages: 36
Date: 2026-09-08
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Persistent link: https://EconPapers.repec.org/RePEc:ags:unadrs:410373

DOI: 10.22004/ag.econ.410373

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