The impact of high-speed rail on innovation: An empirical test of the companion innovation hypothesis of transportation improvement with China’s manufacturing firms
Yanyan Gao () and
World Development, 2020, vol. 127, issue C
Garrison and Souleyrette II (1996) elaborated a companion innovation hypothesis which says that improvements in transportation energize innovation in other sectors by creating opportunities to accomplish old things well or do something new. However, existing literature provides limited direct evidence on this hypothesis. The fast rollout of high-speed rail (HSR) in China is explored as a natural experiment to test the hypothesis by matching it with three waves of innovation surveys on manufacturing firms from counties in the Yangtze River Delta and Pearl River Delta, China’s two most developed regions. The empirical results, obtained using the difference-in-differences method, show that HSR connection promotes firm innovation in peripheral areas, which is larger in the Yangtze River Delta and increases over time but switches from promoting process innovations to stimulating product innovation. Further studies show that HSR connection promotes innovation by arousing entrepreneurs’ awareness of the importance of innovation and intellectual property protection, opening new sources for innovation and bringing about market size effects.
Keywords: Transportation; High-speed rail; Companion innovation; Manufacturing firms; China (search for similar items in EconPapers)
JEL-codes: O31 L92 P25 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:127:y:2020:i:c:s0305750x19304875
Access Statistics for this article
World Development is currently edited by O. T. Coomes
More articles in World Development from Elsevier
Bibliographic data for series maintained by Haili He ().