High-Speed Railroad and Economic Geography: Evidence from Japan

Zhigang Li () and Hangtian Xu ()

No 485, ADB Economics Working Paper Series from Asian Development Bank

Abstract: This study addresses the debate on whether high-speed railroad (HSR) polarizes or balances economic geography. We find that both can occur: while the service sector tends to agglomerate, the manufacturing sector may decentralize; moreover, economic activities may agglomerate from distant areas to the core, while dispersing from the core toward its periphery at the same time. The service sector is crucial in this process because, unlike other land transport infrastructure, HSR mainly saves transport time for people, but not cargo. Incorporating this feature to the model of Ottaviano et al. (2002), we show that HSR can lead to either polarization or diffusion depending on sector and distance between cities. This is supported by empirical evidence from the 1982 opening of two major HSRs in Japan (Shinkansen), which saved intercity travel time by as much as half. We find that in noncore areas service employment decreased by 7%, while manufacturing employment increased by 21%; cities within approximately 100 kilometers of Tokyo expanded, while more distant cities shrank. In net, Tokyo metropolitan area agglomerates as a result of HSR.

Keywords: economic corridor; high-speed rail; inclusive growth (search for similar items in EconPapers)
JEL-codes: H54 O18 R12 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2016-05-31
New Economics Papers: this item is included in nep-geo, nep-reg, nep-tre and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: High‐speed railroads and economic geography: Evidence from Japan (2018)
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