In this paper, we investigate how the impacts of infrastructure change when considered in isolation or, instead, when bundled together. Moneke (2020) is one of the few studies to have considered interactions of infrastructure investments. Using data from Ethiopia, he shows that the combination of market access provided by roads and the positive productivity effect of electrification on non-agricultural production is key for the achievement of large effects of infrastructure on economic development. Our paper complements Moneke (2020) by expanding the geographic analysis to 27 countries, and by considering the outcomes at household rather than district level. To the best of our knowledge, our paper is the first to study the impact of roads and electricity and their interaction at the continental level in Africa, and to document significant heterogeneities. We find that the effects of isolated and bundled infrastructure differ significantly - between lagging and more advanced regions, across gender, and among various age groups. We complement the findings from the literature that lagging and leading regions benefit differently by documenting and comparing these impacts when investments are bundled and when they are isolated. For instance, Mu and van de Walle (2011) find that, in Vietnam, benefits from rural road improvements are greater in poor communities, where levels of initial market development are lower. Moreover, we find that improved infrastructure in rural areas induces a shift away from agricultural and other lowskilled jobs into more skilled occupations; and, by contrast, that improved infrastructure in urban areas promotes all types of employment. These differential effects suggest that the structural transformation brought about by road and electricity expansions is primarily a rural phenomenon. These findings are new.

The remainder of this paper is organized as follows: Section 2 describes a simple conceptual framework of infrastructure and job creation, and findings from the related literature. Section 3 presents data sources. Section 4 discusses identification strategies. Sections 5 and 6 present findings on the average and heterogeneous effects of employment outcomes from infrastructure investment, with a special focus on the contrasts between the effects on urban and rural economies. Section 7 concludes.

# **2 Conceptual framework**

Investment in infrastructure could influence employment outcomes through a range of different channels and effects. First, infrastructure programs can lead to direct employment on site for construction, maintenance, and operation. Second, large investments in infrastructure could stimulate short-term growth and indirectly contribute to jobs creation in related industries (Romer and Bernstein, 2009). Third, and perhaps most importantly, infrastructure could induce employment expansion and enhance the quality of employment by boosting productivity, improving competitiveness, and enhancing market access for both households and firms. Jobs created under this category tend to be longer term and broad based. The rest of this section lists the main economic channels through which access to roads and electricity affects long-term employment, the interactions between both types of investments, and their heterogeneous impacts across population groups and locations. While not exhaustive, this discussion seeks to address the main economic channels of interest to set the stage for interpretation of the results of our empirical analysis.

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