The long-term impact of Italian colonial roads in the Horn of Africa, 1935-2015

This article exploits the quasi-natural experiment provided by the extensive road networkthat was built across the Horn of Africa during the Italian occupation ofEthiopia (1936–1941), to examine how a first-mover advantage in transportation canaffect the spatial distribution of economic activity in developing countries over thelong run. The results show that Italian paved roads rendered areas located within10 km of them significantly more populated, urbanized and luminous around 2010,relative to comparable, more distant locations. Early roadbuilding lifted first-moverlocations out of isolation and allowed for net welfare gains, thanks to a reduction intransport costs and specialization. To this day, first-mover locations continue to divergefrom the control group, due to a coordination mechanism that led to an oversupplyof governmental facilities in the post-colonial period.