The influence mechanisms of transport infrastructure on China’s domestic trade: Evidence from trade weight data

Abstract

Transport infrastructure is essential for economic growth and regional development, yet its impact on domestic trade has not been extensively studied. For data availability and to mitigate the effects of price volatility, this study utilizes interregional goods exchange data within China to substitute for trade value, examining how transport infrastructure affects intra-provincial and inter-provincial trade. A spatial econometric model is applied to analyze the factors influencing these effects. The results indicate that transport infrastructure significantly enhances domestic trade, with a more pronounced effect on intra-provincial trade than on inter-provincial trade. The mechanisms through which transport infrastructure influences domestic trade include four pathways: the direct effect, the independent mediating effect of industrial agglomeration, the independent mediating effect of technological innovation, and a chain mediating effect involving ‘industrial agglomeration $\to$ technological innovation’. Among these effects, the direct effect of transport infrastructure on domestic trade is the strongest, followed by the independent mediating effect of technological innovation. Furthermore, the trade-promoting effects of industrial agglomeration and technological innovation are more substantial in provinces with lower transport density, whereas the chain mediating pathway is more effective in provinces with medium to high transport density.