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Justifying a high-speed rail project: social value vs. regional growth

Author

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  • Fernand Martin

    (Department of Economics, UniversitÊ de MontrÊal, C.P. 6128 Succursale Centre-ville, MontrÊal, QuÊbec, Canada, H3C3J7)

Abstract

This article establishes a relationship between the net present value (NPV) of a High-Speed Rail (HSR) project and its social value, its transportation consumers` surplus (TCS) and its regional economic impact in terms of growth. First, it is shown that if the NPV is positive, it may generate growth even if no bottleneck exists. Second, when shadow-pricing and externalities are included in the calculations, and the HSR demand has been forecasted by a multinomial logit model, the NPV differs from its net economic impact. For instance, one variant of the project, though acceptable, reduces growth elsewhere in the economy. Decision-making is then in a quandary.

Suggested Citation

  • Fernand Martin, 1997. "Justifying a high-speed rail project: social value vs. regional growth," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 31(2), pages 155-174.
    • Handle: RePEc:spr:anresc:v:31:y:1997:i:2:p:155-174
    Note: Received: April 1996 / Accepted: May 1996
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    Cited by:

    1. Kim, Hyojin & Sultana, Selima & Weber, Joe, 2018. "A geographic assessment of the economic development impact of Korean high-speed rail stations," Transport Policy, Elsevier, vol. 66(C), pages 127-137.
    2. Chen, Zhenhua, 2023. "Socioeconomic Impacts of high-speed rail: A bibliometric analysis," Socio-Economic Planning Sciences, Elsevier, vol. 85(C).
    3. Zhan, Shuguang & Wong, S.C. & Lo, S.M., 2020. "Social equity-based timetabling and ticket pricing for high-speed railways," Transportation Research Part A: Policy and Practice, Elsevier, vol. 137(C), pages 165-186.
    4. Kim, Hyojin & Sultana, Selima, 2015. "The impacts of high-speed rail extensions on accessibility and spatial equity changes in South Korea from 2004 to 2018," Journal of Transport Geography, Elsevier, vol. 45(C), pages 48-61.
    5. De Rus, Ginés, 2011. "The BCA of HSR: Should the Government Invest in High Speed Rail Infrastructure?," Journal of Benefit-Cost Analysis, Cambridge University Press, vol. 2(1), pages 1-28, January.
    6. Wang, Chao & Chen, Junjing & Li, Boyan & Chen, Nengcheng & Wang, Wei, 2023. "Impact of high-speed railway construction on spatial patterns of regional economic development along the route: A case study of the Shanghai–Kunming high-speed railway," Socio-Economic Planning Sciences, Elsevier, vol. 87(PB).
    7. Campos, Javier & de Rus, Ginés, 2009. "Some stylized facts about high-speed rail: A review of HSR experiences around the world," Transport Policy, Elsevier, vol. 16(1), pages 19-28, January.
    8. Adler, Nicole & Pels, Eric & Nash, Chris, 2010. "High-speed rail and air transport competition: Game engineering as tool for cost-benefit analysis," Transportation Research Part B: Methodological, Elsevier, vol. 44(7), pages 812-833, August.

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