The impacts of high speed rail on regional economy and balanced development : Focused on Gyeongbu and Gyeongjeon lines of Korea Train eXpress(KTX)

Abstract

The opening of KTX(Korea Train eXpress), Korean high-speed rail, has shortened the travel time from Seoul to Busan to 2 hours and 18 minutes compared to 4 hours and 10 minutes before the existence of KTX. It has been expected that KTX contributes to increasing the diverse individual activity, the choice of residence and jobs, the choice of location of firms, which in turn contributes to the balanced development at the national level. On the other hand, it has been argued that KTX would increase the concentration of population and economic activity in large urban areas absorbing the resources of lagged regions. This paper aims to empirically analyze the influence of KTX on regional economy to test the above two hypotheses. Three Beta-convergence models with GRDP, population, and employment are applied for communities along the Gyeongbu-line. The results show that the region is moving to regional divergence in terms of GRDP and population distribution, while there exists beta-convergence in terms of employment. It is argued that KTX contributes to the divergence of GRDP and population.