Roads and Loans

Abstract Does financing respond to changes in productive opportunities, even for the world’s poor? We answer this question by examining response of private bank an infrastructure program that brought road access unconnected Indian villages. This prioritized roads villages above specific population thresholds, allowing us exploit resultant discontinuities identification. Using detailed data from a large bank, we find 75$\%$ more villagers get loans, and average amount lent them is 30$\%$–35$\%$ higher, just these thresholds. District-level analyses further suggest loans are complements growth process. Authors have furnished Internet Appendix, which available on Oxford University Press Web site next link final published paper online.