Can the opening of high-speed rail (HSR) stimulate residents' consumption? --An interpretation based on the clustering effect of innovation factors

Abstract

The high-speed rail (HSR) unites various cities, potentially expanding the production and consumption scale, and improving the efficiency of supply and demand adaptation while fostering increased consumption in local areas. This study investigates the effect of HSR on residents' consumption using data from 260 prefecture-level Chinese cities spanning 2005 to 2021 and discovers the underlying mechanisms through the perspective of innovation factor agglomeration. The findings revealed that the HSR enhanced the clustering of regional innovation factors, thereby stimulating consumption through mechanisms including job conception and product innovation. Further analysis explored that the agglomeration of capital, talent, and data innovation factors driven by HSR development exerted varying degrees of influence on boosting consumption. Furthermore, based on city type and grade, the effect of the HSR on residents' consumption displayed heterogeneity. The findings of the current study carry significant policy implications, suggesting the requirement for tailored planning of HSR development that considers city types and the unique characteristics of various elements, thereby prompting the potential energy of innovation factor agglomeration.