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From periphery to core: measuring agglomeration effects using high-speed rail

Ahlfeldt, Gabriel M. and Feddersen, Arne (2015) From periphery to core: measuring agglomeration effects using high-speed rail. SERC discussion papers, SERCDP0172. Spatial Economics Research Centre, London, UK.

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Identification Number: SERCDP0172

Abstract

We analyze the economic impact of the German high-speed rail (HSR) connecting Cologne and Frankfurt, which provides plausibly exogenous variation in access to surrounding economic mass. We find a causal effect of about 8.5% on average of the HSR on the GDP of three counties with intermediate stops. We make further use of the variation in bilateral transport costs between all counties in our study area induced by the HSR to identify the strength and spatial scope of agglomeration forces. Our most careful estimate points to an elasticity of output with respect to market potential of 12.5%. The strength of the spillover declines by 50% ever 30 minutes of travel time, diminishing to 1% after about 200 minutes. Our results further imply an elasticity of per-worker output with respect to economic density of 3.8%, although the effects seem driven by worker and firm selection.

Item Type: Monograph (Discussion Paper)
Official URL: http://www.spatialeconomics.ac.uk/
Additional Information: © 2015 The Authors
Subjects: H Social Sciences > HE Transportation and Communications
H Social Sciences > HF Commerce
Sets: Research centres and groups > Spatial Economics Research Centre
Collections > Economists Online
Date Deposited: 25 Nov 2015 12:00
Last Modified: 25 Nov 2015 12:00
Funders: Economic and Social Research Council, Department for Business, Innovation & Skills, Welsh Government
URI: http://eprints.lse.ac.uk/id/eprint/64507

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