Infrastructure investment may reshape economic activities. In this paper, I examine the distributional impacts of high-speed rail upgrade in China, which improved passengers' access to speedy train services in the city nodes but impaired train access in peripheral counties being bypassed by the services. By exploiting the quasi-experimental variation in whether counties were affected by this project, my analysis suggests that the affected counties on the upgraded railway lines experienced reductions in GDP and GDP per capita following the upgrade, which was largely driven by the concurrent drop in fixed asset investment. This paper provides the first empirical evidence on how does transportation cost of people affect urban peripheral patterns.
We used a primary panel survey at the household level conducted in 18 remote natural villages over three waves in China to study how road access shapes farmers' agricultural production patterns and input uses. Our results show that access to roads is strongly associated with specialization in agricultural production. In natural villages with better road access, farmers plant fewer numbers of crops, purchase more fertilizer, and invest more money on labor hiring. In combination of these factors, road connections improve household agricultural income, and in particular cash income. However, better access to rural roads does not appear to bring about significant changes in non-agricultural income.
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