Impacts of French High-Speed Rail Investment on Urban Agglomeration Economies

In order to investigate the role of high-speed rail (HSR) investment in aiding the transformation process of urban agglomeration economies, this study focuses on three fundamental questions through an observation of more than 100 French cities. First, how has HSR investment impacted the reshaping of accessibility patterns in France? Using rail travel timetables from 1982 to 2009, I adopt gravity models to identify the spatial distribution of accessibility in France. I find that although the introduction of HSR improved the level of mobility and accessibility both between Paris and other cities and among cities in general, this was unequal and depended upon the location of cities relative to the newly built HSR line. Second, does HSR investment induce agglomeration economies? If so, how? I use commune-level panel data to study the economic performance of HSR cities by using a matched-pair analysis and various regression models with instrumental variables. I find that the key determinant for boosting agglomeration economies is the level of HSR train frequencies to/from Paris, rather than travel-time savings. Moreover, panel estimation shows that the evidence for the economic impact of HSR investment is mixed and location specific. However, the impact of HSR on the knowledge-based job market is positive. Finally, what is the effect of the spatial competition of HSR investment on the location choices of French firms? I develop a survey and in-depth interview approaches to conclude that most firms in France do not believe HSR itself can influence location choice or make a significant contribution to company growth. Instead, factors related to land value appear to be the most influential determinant in the distribution and relocation of firms, particularly knowledge-based firms. In conclusion, the evidence suggests that investment in HSR needs to be considered rationally, and factors such as the optimal competitive advantage of HSR and daily HSR train frequencies should be taken into account. In addition, regardless of where an HSR station is located, a well-developed and efficient local transportation service will maximize the benefits of the HSR service itself and expand the market coverage