Highway to Success: The Impact of the Golden Quadrilateral Project for the Location and Performance of Indian Manufacturing

In this paper, published in The Economic Journal, Kerr, Grover and Ghani (2015) investigate the impact of transport infrastructure on the organisation and efficiency ofmanufacturing activity. The Golden Quadrilateral (GQ) project upgraded a central highway networkin India. Manufacturing activity grew disproportionately along the network. These findings hold instraight-line IV frameworks and are not present on a second highway that was planned to be upgraded atthe same time as GQ but subsequently delayed. Both entrants and incumbents facilitated the outputgrowth, with scaling among entrants being important. The upgrades facilitated better industrial sortingalong the network and improved the allocative efficiency of industries initially positioned on GQ.