Journal of International Development Studies
Online ISSN : 2434-5296
Print ISSN : 1342-3045
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The Effects of Irrigation and Road Accessibility on Rural Development in Lao PDR: Based on the Survey in Vientiane Province
Byoungki KIM
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JOURNAL FREE ACCESS

2015 Volume 24 Issue 2 Pages 113-127

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Abstract

Laos has been promoting development of social and economic infrastructure for remote rural communities and mountain regions where people have been engaged in subsistence agriculture since the introduction of the market economy mechanism in 1986. But the development of infrastructure such as road access and irrigation equipment is insufficient in rural areas especially isolated from the city. In this paper, we analyze the economic effects of road accessibility and irrigation equipment on agricultural production, sales, income, expenditure and savings based on a household survey which was carried out in Vientiane province in 2011.

We found that irrigation equipment has a strong impact on the production of rice in the dry season, and road accessibility has a strong impact on the production and sale of rice during the wet season. Accessible roads to the market in the wet season and irrigation equipment in the dry season play an important role in increasing the volume of rice production and sales. Road accessibility improves the quality of life by enabling access to health facilities and education along with increasing consumption of production factors and consumer goods. In addition, it provides an opportunity to earn income from the non-agricultural sector. Infrastructure development contributes to supplementing the information asymmetry and helps with the issue of lack of goods market. It also encourages the spread of market-oriented economy in rural areas.

The development of infrastructure is indispensable but this alone is not sufficient for rural development. Diffusion of financial intermediation functions, contracting farming and commercialization of agricultural crops by distribution networks are also critical. Incentives for expanding agricultural production of farmers will work when contract farming and commercialization of agricultural crops are promoted by the government. In order to increase farmers' income, irrigation and roads development and support with financial systems and sale networks by government is very important.

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© 2015 The Japan Society for International Development
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