Does high-speed rail connection really promote local economy? Evidence from China’s Yangtze River Delt
Yanyan Gao, Shunfeng Song, Jun Sun, Leizhen Zang
Corresponding authors: Shunfeng Song, email: firstname.lastname@example.org
Review of Development Economics, Vol.24, No1, 2019
Abstract:High-speed rail (HSR) has led to a transportation revolution in China. This paper uses the county-level panel data of China’s Yangtze River Delta to investigate the effect of HSR connection on local economy. To address the issue of endogenous HSR route placement, we use a straight-line strategy to construct potential HSR connection variables as instrumental variables of the actual HSR connection. Both the difference-in-differences and instrumental variable methods show that HSR connection impedes local economy, especially in peripheral regions. The impediment effect is channeled through population reallocation from peripheral to core areas and the restructuring of industries.
Keywords:difference-in-differences, GDP per capita, high-speed rail, Yangtze River Delta
To link to this article:https://doi.org/10.1111/rode.12642