# **3. Data**

The road network data in the Ethiopia road database were collected from different sources. Federal Road Network data were obtained from the Ethiopian Roads Authority, the main agency in the Road Sector Development Program (RSDP) and Growth and Transformation Plan (GTP); and district- and woreda-level road data were collected from the Regional Road Authorities. The collected information includes years of new construction, upgrading, and rehabilitation, as well as the volume and distribution of the network in the country. It is important to note that the database includes rural roads that were motorable at the time of the national road inventory carried out in 2015−16. Rural roads in some parts of Oromia and Amhara regions were not covered due to missing bridges, as well as Somali region for security reasons.

In analyzing household-level impacts of the recent rural road development, this study primarily relies on the ESS. The ESS, part of the World Bank supported Living Standards Measurement Study-Integrated Surveys on Agriculture (LSMS-ISA), started as the Ethiopian Rural Socioeconomic Survey (ERSS) in 2012. A sample of about 3,470 households were interviewed in rural areas and re-interviewed in 2014 and 2016. Among the rural communities covered by the ESS, this study focuses on the communities that received rural roads between 2010 and 2014 (i.e., treated group) and the other communities that did not receive rural roads between 2010 and 2016 (i.e., control group). This results in 204 communities, including 59 communities in Amhara, 46 communities in Oromia, 37 communities in SNNPR, 26 communities in Tigray, and 36 communities in the other regions.

The recipient indicator used for the econometric analysis in this study is a binary indicator about whether a rural road passes by within the community’s boundary regardless of the road length.<sup>11</sup> How to define households and areas affected by the rural road development is methodologically important. Given the nature of rural roads, this study considers that households in the communities in which rural roads were developed have been affected.<sup>12</sup> Among the 204 communities analyzed for this study, 72 communities had URRAP or other types of rural roads developed between 2010 and 2014. The total length of the segment of the roads within the analyzed communities has reached 400 km.

The main welfare outcome to be considered in this study is household consumption. The consumption aggregate in the ESS includes expenditures on and own-consumption of food (with a recall period of 7 days) and also includes spending on a selection of important nonfood items, including education. Health spending is not included in the aggregate to avoid that large expenses incurred following adverse health shocks would signal an increase in household welfare. This study adjusts the consumption aggregate in the three waves of the ESS in 2016 prices. In addition, spatial adjustments are also made to account for differences in living cost across regions. To convert the nominal consumption into a spatially adjusted real consumption, the consumer price index (CPI) is used to perform temporal adjustment (that is, convert all consumption values into 2016 prices) and the Fisher spatial price index is used for spatial adjustment. For the analysis of poverty, the poverty

> 11 Development of non-rural roads, such as regional corridors, is not considered as the treatment. Iimi et al. (2018) is an example that analyzes the impacts of road access by distinguishing rural roads and regional corridors in Ethiopia.

> 12 No spatial spillover is a key assumption for the identification of the impacts of rural roads (stable unit treatment value assumption, or SUTVA).

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