Information effects of high-speed rail: Evidence from patent citations in China

Using high-speed rail (HSR) connection information and patent citation data, we find robust patterns linking HSR connection with increased patent citations between Chinese cities. Furthermore, HSR connection is shown to slow down the decay in knowledge diffusion over distance. The main results are not only robust to alternative choices of city sample, HSR connection measure, citation measure, and citation windows, as well as other tests, but also remain when the endogeneity concern is addressed. And evidence has been found that academic conferences and the establishment of non-local subsidiaries serve as mechanisms through which HSR connection affects cross-regional knowledge spillovers. The heterogeneity effects of HSR connection are also in line with expectations, where cities with larger innovation capacity gaps, industries with higher delivery costs and faster technological upgrading, and patents with more technological innovation content experience greater impacts of HSR connection. These findings thus provide consistent support for the beneficial effects of transportation infrastructure upgrading on knowledge transfer and technological innovation.