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Access to capital and energy efficiency: How high-speed rail investments benefit high-tech firms

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  • Sun, Wenhao
  • Gao, Jijun
  • Jacoby, Gady
  • Wu, Zhenyu

Abstract

This study examines how high-speed rail network impacts the energy consumption of hi-tech firms along the line. The results show that the opening of high-speed railway stations in a county leads to reduction in energy consumption by hi-tech firms in the county. This effect is stronger with increased density of railway lines in the region. The study identifies two key mechanisms underlying this effect: enhanced financing access and increased overseas outreach. Our findings reveal that improved financing access to public market capital, bank loans, and venture financing enables hi-tech firms to invest in international outreach activities. We also conduct additional analysis to explore nuanced conditions regarding the types of hi-tech firms that benefit the most from being located in a high-speed rail city. Contributions to the emerging field of corporate energy saving are discussed.

Suggested Citation

  • Sun, Wenhao & Gao, Jijun & Jacoby, Gady & Wu, Zhenyu, 2024. "Access to capital and energy efficiency: How high-speed rail investments benefit high-tech firms," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 91(C).
    • Handle: RePEc:eee:intfin:v:91:y:2024:i:c:s1042443123001804
    DOI: 10.1016/j.intfin.2023.101912
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    More about this item

    Keywords

    Energy consumption; Energy saving; Access to capital; Financing access; High-tech firms; Overseas outreach; High-speed rail;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • Q47 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy Forecasting
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

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