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The Effect of Infrastructure on Worker Mobility: Evidence from High-Speed Rail Expansion in Germany

Daniel Heuermann () and Johannes Schmieder

No 24507, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We use the expansion of the high-speed rail network in Germany as a natural experiment to examine the causal effect of reductions in commuting time between regions on the commuting decisions of workers and their choices regarding where to live and where to work. We exploit three key features in this setting: i) investment in high-speed rail has, in some cases dramatically, reduced travel times between regions, ii) several small towns were connected to the high-speed rail network only for political reasons, and iii) high-speed trains have left the transportation of goods unaffected. Combining novel information on train schedules and the opening of high-speed rail stations with panel data on all workers in Germany, we show that a reduction in travel time by one percent raises the number of commuters between regions by 0.25 percent. This effect is mainly driven by workers changing jobs to smaller cities while keeping their place of residence in larger ones. Our findings support the notion that benefits from infrastructure investments accrue in particular to peripheral regions, which gain access to a large pool of qualified workers with a preference for urban life. We find that the introduction of high-speed trains led to a modal shift towards rail transportation in particular on medium distances between 150 and 400 kilometers.

JEL-codes: J61 R12 R23 R40 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab, nep-reg, nep-tre and nep-ure
Date: 2018-04
Note: LS
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Published as Daniel F Heuermann & Johannes F Schmieder, 2019. "The effect of infrastructure on worker mobility: evidence from high-speed rail expansion in Germany," Journal of Economic Geography, vol 19(2), pages 335-372.

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