Economic impacts of accessibility gains: Case study of the Yangtze River Delta

Transport infrastructure development is generally perceived as catalyst for economic growth. This has been highlighted in previous literature, generally focusing on the economic impact of transport infrastructure investments. This paper contributes to spatial econometrics by examining the causal relationship between economic strength and accessibility gains due to the development of expressways and high-speed rail, taking the Yangtze River Delta as research object. Spatial regression models that accommodate for the influence of spatial autocorrelation and the newly defined variable "weighted mode's average travel time (WMATT)" and other explanatory variables are developed for quantitative analysis. Estimation results indicate that cities' gross domestic product increases significantly with population, passenger traffic, and foreign direct investment. Especially, all the estimated models indicate that WMATT is significantly and negatively associated with gross domestic product, revealing that inter-city accessibility gains (travel-time savings) can enhance economic strength. The robustness analysis on the estimators indicates that while the β-coefficient of WMATT generally increases with the share of expressways and high-speed rail in land transportation, its p-value increases and its effect may become insignificant if inter-city travel time becomes fast enough. Findings from this study highlight the travel-speed up measures such as open China's expressway freely and speed up the high-speed rail rather than blind development and endless investments can also play an important role in enhancing economic strength.