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To be connected or not to be connected? The role of long-haul economies
[Do rural roads create pathways out of poverty? Evidence from India]

Author

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  • Hans R A Koster
  • Takatoshi Tabuchi
  • Jacques-François Thisse

Abstract

We investigate whether localities gain or lose employment when there are connected to a transportation network, such as a high-speed railway line. We argue that long-haul economies—implying that the marginal transportation cost decreases with network distance—play a pivotal role in understanding the location choices of firms. We develop a new spatial model to show that improvements in transportation infrastructure have nontrivial impacts on the location choices of firms. Using data on Japan’s Shinkansen, we show that ‘in-between’ municipalities that are connected to the Shinkansen witness a sizable decrease in employment.

Suggested Citation

  • Hans R A Koster & Takatoshi Tabuchi & Jacques-François Thisse, 2022. "To be connected or not to be connected? The role of long-haul economies [Do rural roads create pathways out of poverty? Evidence from India]," Journal of Economic Geography, Oxford University Press, vol. 22(4), pages 711-753.
    • Handle: RePEc:oup:jecgeo:v:22:y:2022:i:4:p:711-753.
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    Cited by:

    1. Gabriel Loumeau & Antonio Russo, 2022. "Second-Hand Gentrification: Theory and Evidence from High-Speed Rail Extensions," CESifo Working Paper Series 9992, CESifo.
    2. Yongling Li & Junxian Yang & Weiqiang Zhang & Zhou Zhou & Jianhui Cong, 2022. "Does High-Speed Railway Promote High-Quality Development of Enterprises? Evidence from China’s Listed Companies," Sustainability, MDPI, vol. 14(18), pages 1-33, September.
    3. Lisha Wang & Jian Wang & Xuepeng Qian, 2023. "Does the bullet train exacerbate urban shrinkage? Lessons from Japan," Papers in Regional Science, Wiley Blackwell, vol. 102(1), pages 187-212, February.
    4. Bottasso, Anna & Conti, Maurizio & Ferrara, Antonella Rita & Robbiano, Simone, 2023. "High-Speed Railways and Firms Total Factor Productivity: Evidence from a Quasi-Natural Experiment," IZA Discussion Papers 16572, Institute of Labor Economics (IZA).
    5. Yoo, Sunbin & Kumagai, Junya & Kawasaki, Kohei & Hong, Sungwan & Zhang, Bingqi & Shimamura, Takuya & Managi, Shunsuke, 2023. "Double-edged trains," Transport Policy, Elsevier, vol. 133(C), pages 120-133.
    6. Liang Xu & Zhigao Liu, 2022. "The Evolution of the Spatial Patterns of Startup Firms in the Tibet Autonomous Region, China in the 21st Century," Sustainability, MDPI, vol. 14(15), pages 1-18, August.
    7. Han Zhang & Dongli Wu, 2022. "The Impact of Transport Infrastructure on Rural Industrial Integration: Spatial Spillover Effects and Spatio-Temporal Heterogeneity," Land, MDPI, vol. 11(7), pages 1-18, July.

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    More about this item

    Keywords

    Long-haul-economies; firm location; high-speed rail; Japan; Shinkansen;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General

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