Why Cities Backfire? High-Speed Railway New Town Planning and Urban Structural Change

This research, examining the Yangtze Delta megalopolis in East China as our case, uncovers the causal impact of HSR new town planning on urban structural change. The results illustrate that HSR town planning significantly inhibits the average productivity of tertiarisation per labour unit in hub cities but facilitates industrialisation in non-hub ones. The dynamic effects indicate a response lag in the impact after three to five years. For big cities, the productivity decline is attributable to a surge in employment within the services; by contrast, outmigration and a distant station from city centres suppress tertiarisation in small cities, ironically elevating their unit productivity of secondary and tertiary sectors. Our findings unpack a siphon effect within the service sector, where labour and economic activities over-concentrate in core cities. Yet, the dynamic lag and the rigidity of sectoral output paradoxically enhance labour productivity in non-core areas whose industrialisation seems interlinked with industrial out-diffusion from hub cities. Our research contributes to the knowledge, evidence, and policy implications of post-HSR planning in the unbalanced structural transformation of regional and urban economies.