Assessing the Economic Impacts of High-Speed Rail Operation on Surrounding Areas: Evidence fromIndonesia
Year: 2026
Type: article
Abstract: As a developing country, Indonesia has successfully built its first high-speed rail (HSR), which is also the first in Southeast Asia. The HSR development forms part of the national transportation infrastructure modernization to enhance connectivity between strategic regions. Research on HSR impacts in Indonesia remains limited; therefore, this study tries to establish the causal impact of HSR development on the economic activities of the surrounding areas. This study uses the smallest administrative units (villages/urban wards) as the unit of analysis and Night-time light (NTL) intensity as a proxy for economic activity. The estimation results indicate that proximity to HSR stations significantly increases local economic activity. The findings are robust to various tests, such as falsification tests, applying Propensity Score Matching (PSM), placebo tests, and using an alternative sample period. This research contributes to the literature on infrastructure development by providing additional evidence on the benefit of infrastructure on local economies.
Authors: Nanda Bagus Rahmawan, Milda Irhamni
Institution: University of Indonesia
Language: English
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W7214673183