Build or Borrow? A Spatial Durbin Analysis of Thailand's Eastern Economic Corridor

Ait Benhamou Zouhair, Baumann Sylvain and Kanyarat Nimtrakool ()
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Ait Benhamou Zouhair: EDEHN - Equipe d'Economie Le Havre Normandie - ULH - Université Le Havre Normandie - NU - Normandie Université, FAI - Université Le Havre Normandie - Faculté des Affaires Internationales - ULH - Université Le Havre Normandie - NU - Normandie Université
Baumann Sylvain: FAI - Université Le Havre Normandie - Faculté des Affaires Internationales - ULH - Université Le Havre Normandie - NU - Normandie Université, EDEHN - Equipe d'Economie Le Havre Normandie - ULH - Université Le Havre Normandie - NU - Normandie Université
Kanyarat Nimtrakool: Chulalongkorn University [Bangkok]

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Abstract: Does a flagship maritime corridor create economic activity, or merely shuffle it? We study Thailand's Eastern Economic Corridor (EEC, designated 2018) with a 1995-2024 provincial panel of gross provincial product and post-2018 geolocated firm microdata. We derive a firm-location model whose log-linearisation is an exact spatial Durbin model, so that the cross-province spillover is identified as a reallocation parameter and the firm-weighted adding up sum turns the reallocation hypothesis into a testable restriction rather than a narrative. The corridor's local effect is essentially zero, the spillover is negative (-0.043), the total effect is -0.027, and the cumulative effect is significantly negative, so creation is rejected in favour of reallocation. The negative sign for spillover holds across ten spatial weight matrices, including travel-time road networks, and survives placebos in time and space, while the firm data show a subdistrict's dissolutions rising with its neighbours' formation. Henceforth, we conclude the EEC borrowed activity from its periphery rather than building it.

Date: 2026-07-12
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