This study investigates the long-term causal effect of heavy U.S. bombing missions during the Vietnam War on later economic development in Lao P.D.R. The empirical strategy relies on an instrumental variables approach. We exploit the distance between the centroid of village-level administrative boundaries and heavily bombed targets—the Ho Chi Minh Trail in the case of southern Laos and Xieng Khouang province in the case of northern Laos—as an instrument for the intensity of U.S. bombing missions. We use the three rounds of average nightlight strength data (1992, 2005, and 2013), and two rounds of population density data (1990 and 2005) as the outcome variables. The estimation results show no robust effect of U.S. bombing missions on economic development in the long term. Meanwhile, we find that the results do not necessarily support the conditional convergence hypothesis within a country, although this result could be Lao-specific.