Working papers

Internal Trade Barriers in India
(with Prabhat Barnwal, Jonathan Dingel, Pravin Krishna, Eva van Leemput)

We study barriers to intranational trade in India, which has extensive roads but an inefficient transportation and logistics sector. The Goods and Services Tax introduced in 2017 imposed nationwide tax rates and eliminated the need for tax-collection checkposts at state borders. We quantify the impact of this checkpost reform using high-frequency Global Positioning System records, trucking logs, and a survey of truck drivers. The reform sped up border crossings substantially: average duration declined more than one-third. Eastern states, which had slower checkposts before the reform, improved the most. Household expenditures rose in districts where GST improved market access, suggesting substantial returns to reducing interstate trucking costs.