were at least 2 kilometers away from the study or any other paved road. About 50 households were selected from each study village using a stratified random sampling procedure. Both surveys collected a variety of information on general household characteristics, education, healthcare treatment, wage and self-employment, credit activities, assets, income, consumption, marriage, and fertility. Additionally, information on community characteristics and transportation was also collected.<sup>9</sup> The outcomes of interest include variables such as household transport expenses, fertilizer price, male agricultural wage, agricultural output and price indices, and household outcomes such as per capita expenditure, male and female labor supply, and boys’ and girls’ schooling.

Road improvements affect the household through changes in three mechanisms: (1) transportation costs as well as input and output prices; (2) labor supply, as well as farm and non-farm production; and (3) household outcomes such as earnings, consumption, and schooling. In our results, we first examine the impact of road development on transport costs. Since there were very few households that reported transportation costs for production, we therefore focus on household transport costs that include costs incurred while going to such places as the market center, school, and nearest health facility.

Next, we consider input and output prices such as fertilizer (urea) price, daily agricultural wage for men, as well as agricultural output and price indices.<sup>10</sup> For the latter indices, we use the Laspeyres quantity and price indices for agricultural production. In constructing the Laspeyres indices, let _k_ stand for commodity, _i_ for household, and _t_ ={0,1} for year before and after the project. Defining the base year ( _t_ =0) price for each commodity as<sup>_P_</sup> _k_ 0<sup>, and the base year quantity of each commodity produced by the</sup> <u>∑</u> _k Qk_ 1 _Pk_ 0 household as _Qk_ 0 , then _Qi_ = is the Laspeyres quantity index for household _i_ , and ∑ _k Qk_ 0 _Pk_ 0 In both the RDP and RRMIMP data, the agricultural commodities entering the indices were potato, wheat, as well as high-yielding variety (HYV) Boro paddy, HYV Aman, and local and HYV Aus. Since the study covers only a base and a follow-up year, the base year indices for both aggregate price and output indices are equal to one. Note that all the values are in real terms, adjusted by the consumer price index of the base year of each survey.

> 9 For the RRMIMP study, not all villages were visited again in the follow-up survey.  A total of 7 out of 10 project villages and 2 out of 4 control villages were covered in the RRMIMP survey because (1) the roads were either not completed, or (2) control villages lost their control status as a paved road had been constructed within two kilometers of the village (thereby violating the basic assumption of being a control in the study). 10 Note that similar to aggregate crop output and price indices, we could calculate an index for fertilizer prices consisting of a number of fertilizers.  However, there are a few observations for types of fertilizer such as potash. So the fertilizer price here refers to the price of urea.

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