Choosing Rural Road Investments to Help Reduce Poverty

The paper first critically reviews past and current practices in how rural road investments are selected. An attempt is then made to develop an operational approach that is grounded in a public economics framework in which efficiency and equity concerns are inseparable, information is incomplete in important ways, and resources are limited. A key problem addressed is that a potentially important, though unknown, share of the benefits to the poor from rural roads cannot be measured in monetary terms. The proposed method aims to identify places where poverty, inaccessibility and economic potential are high. The method is illustrated for Vietnam.