Does High-Speed Rail Promote Agglomeration in China?

Abstract

This paper constructs the agglomeration model of crossregional labor flow and market accessibility based on the new economic geography model. Using panel data in 2000-2013, this paper examines the impact of high-speed railways on industrial agglomeration. The results show that high-speed railway significantly promotes the spatial agglomeration of industrial firms. The high-speed railway promotes industrial agglomeration by promoting crossregional mobility of industrial labor and improving market accessibility. We also construct the instrument variable based on HSR construction cost and apply the TSLS model to solve the potential endogenous problems. At the same time, PSM results also get the net effect caused by the repair of a high-speed railway, which verifies the robustness of the results.