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High-Speed Railways and Firms Total Factor Productivity: Evidence from a Quasi-Natural Experiment

Author

Listed:
  • Bottasso, Anna

    (CIRIEC)

  • Conti, Maurizio

    (University of Genoa)

  • Ferrara, Antonella Rita

    (University of Calabria)

  • Robbiano, Simone

    (University of Eastern Piedmont)

Abstract

The focus of this study is to assess the causal impact of the connection of a local area to a high-speed rail network (HSR) on firms' total factor productivity (TFP). The quasi-random location of the HSR station in the Italian city of Reggio Emilia is exploited in a Difference-in Differences (DiD) research design applied to a large sample of firms, observed over the period 2010-2018. The results suggest that the opening of the HSR station improved treated firms' TFP of about 5%; in particular, such effect is larger for firms closer to the HSR station and slightly increases over the sample period. We also find that the impact of the connection to the HSR station is heterogeneous across industries and depends on firms' size and past productivity. Overall results are robust to a large number of sensitivity checks and falsification tests.

Suggested Citation

  • 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).
    • Handle: RePEc:iza:izadps:dp16572
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    More about this item

    Keywords

    transport infrastructure; Difference-in-Differences; total factor productivity;
    All these keywords.

    JEL classification:

    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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