How China's high-speed rail promote local economy: New evidence from county-level panel data

Abstract

This study uses Chinese county-level panel data to determine the effect of high-speed rail (HSR) connection on local economic growth. We find that HSR connection promotes economic growth, and this effect becomes increasingly obvious over the HSR operation time. Besides, HSR connection may affect the relationship between local and neighboring areas. When local and neighboring areas are HSR-connected, a cooperative relationship occurs at the average level of industry structures. When local areas are HSR-unconnected but neighboring areas are HSR-connected, a certain degree of spillover effect occurs rather than a siphon effect. Moreover, the increase of HSR connectivity not only optimizes the allocation of production factors within urban agglomerations but also generally promotes convergence of regional economies.