Upgrade of Transportation Infrastructureand Siting of Polluting Enterprises:The Case of High-Speed Railway Launch in China

Abstract

With the quasi-natural experiment of the launching of high-speed railwaysin Chinese cities, this paper empirically investigated the effects of the upgrade of thetransportation infrastructure on the site selection of polluting enterprises. We found thatalthough the launching of a high-speed railway generally has a negative impact on the sitingof polluting enterprises: (i) While there was a significant decrease in polluting enterprisesof a private and other nature, the reduction in overseas-funded and state-owned enterpriseswas insignificant; (ii) while the launching of a high-speed railway greatly restrained theentry of polluting enterprises in the eastern region, large cities and more developed cities,this was followed by the movement of more polluting enterprises to the central and westernregions, small and medium-sized cities and less developed cities; (iii) there was a significantdecrease in polluting enterprises in environmentally conscious cities after the launchingof a high-speed railway. This paper also found that infrastructure upgrade may influencethe siting of polluting enterprises through the following: Environmental cleanness, factorconcentration and spatial integration. Government authorities and market entities shouldbe fully aware of and attach great importance to how the transportation infrastructureinfluences the site selection of businesses, as this is of great significance for China’s regionaldevelopment planning, local business climate and investment planning, environmentalprotection, and other related policymaking initiatives.