makes the case of a low-income country particularly interesting? Unlike their counterparts in advanced and emerging countries, SEZ programs in Cambodia and many other low-income countries do not necessarily target economically-distressed areas. On the contrary, low-income countries’ SEZ programs serve as a vehicle for a broader export diversification policy and target locations with more developed infrastructure and access to transportation networks.
This paper constructs a novel geo-taggedSEZdatabase and matches it to Cambodia’s household survey data at the
This study examines the socio-economic impact of special economic zones (SEZs) in Cambodia---a prominent place-based policy established in 2005. The paper employs a database on existing and future SEZs in Cambodia with matched household surveys at the district level and documents stylized facts on SEZs in a low-income country setting. To identify causal effects of the SEZ program, the paper (i) constructs an alternative control group including future SEZ program participants and districts adjacent to SEZ hosts; and (ii) employs a propensity score weighting technique. The study finds that entry of SEZs disproportionately benefits female workers and leads to a decline of income inequality at a district level. However, the findings also suggest that land values in SEZ districts tend to rise while wage levels remain largely unchanged relative to other districts. In addition, the paper tests for socio-economic spillovers to surrounding areas and for agglomeration effects associated with clusters of multiple SEZs.