Reports and reference guides
10 January 2009
10 Jan 2009
Regional Economic Impacts of Cross-Border Infrastructure: A General Equilibrium Application to Thailand and Lao PDR
Asian Development Bank
This paper analyzes the economic impacts of the Second Mekong International Bridge linking Mukdahan Province in Thailand with Savannakhet Province in the Lao People's Democratic Republic using a general equilibrium model. The authors find that the reductions in transport costs increase trade volumes and incomes in both regions, and that these benefits increase significantly over time. There is no evidence to support the common presumption that the benefits from cross-border infrastructure projects occur only, or overwhelmingly, in the richer region.