High-speed rail expansion in China boosted agricultural productivity, enabling labour and land to be reallocated from agriculture without reducing agricultural output.
Editor’s note: A version of this article first appeared on VoxChina. For a broader synthesis of themes covered in this article, check out our VoxDevLit on Land Transport Infrastructure.
Large-scale transport infrastructure has become a cornerstone of development strategies worldwide, with China’s high-speed rail (HSR) network standing as the most prominent example (Gonzalez-Navarro and Zárate 2023). By the end of 2021, China had built more than 40,000 kilometres of HSR, accounting for approximately two-thirds of the world’s HSR tracks. This expansion has dramatically reduced travel times, reshaped urban hierarchies, and deepened regional economic integration. Yet alongside these achievements, a growing policy concern has emerged: does HSR undermine agricultural development by accelerating labour outflows and farmland loss?
These concerns are well grounded. A large evidence base shows that improved transport infrastructure can facilitate the migration of agricultural labour into off-farm employment (Asher and Novosad 2020, Morten and Oliveira 2024) and reduce cropland both directly through construction and indirectly through urban expansion (Baum-Snow et al. 2017). In China, where agricultural labour has declined rapidly and pressure on arable land is persistent, such dynamics raise concerns for food security and rural agricultural development. Yet the aggregate evidence presents a striking puzzle: despite rapid labour outflows from agriculture and continued urban expansion, China’s agricultural output has remained broadly stable over the past two decades. This raises an important policy-relevant question: can large-scale transport infrastructure coexist with sustained agricultural production, and if so, through what mechanisms?
In our research (Chen, Gong, Qin, and Wang 2026), we address this puzzle by examining how access to HSR affects agricultural development in rural China. To establish causation, we exploit the staggered rollout of HSR stations across locations as a quasi-natural experiment. Using county-level and household-level data, we estimate a staggered difference-in-differences (DiD) approach that uses unconnected rural counties as the control group and defines treatment cohorts based on the year of HSR station opening.
High-speed rail connectivity increases agricultural productivity
Figure 1 summarises the dynamic effects of HSR connectivity. After gaining HSR access, rural counties experience significant reductions in agricultural labour and cropland (Panels A and B), especially in underdeveloped regions characterised by low GDP, inadequate transport infrastructure, and heavy reliance on agriculture. Despite these declines in inputs, however, we find no evidence that HSR access reduces total agricultural output (Panel E).
Importantly, the resilience of agricultural production appears to stem from productivity gains. Figure 1 shows that HSR access has no statistically or economically significant impacts on fertiliser use and the total number of agricultural machines (Panels C and D). In contrast, agricultural total factor productivity (TFP) rises significantly following HSR access (Panel F), effectively offsetting the negative input effects. Our estimates suggest that HSR connectivity increases county-level agricultural TFP by approximately 4.9–7.8%. These results are robust across alternative methods employed to calculate TFP and when TFP is computed using household-level data.
Figure 1: Dynamic impacts of HSR
Notes: This figure shows the dynamic impacts of HSR on key outcomes using various DiD estimation approaches. Year = 0 represents the year of initial HSR connections. Year = -1 denotes the year prior to HSR connections and serves as the baseline for comparison. Circles, squares, and diamonds in each panel correspond to estimates from TWFE, Borusyak et al. (2024), and Callaway and Sant'Anna (2021), respectively. Whiskers represent 90% confidence intervals.
To ensure that these findings are not driven by non-random HSR placement or modelling assumptions, we conduct a series of robustness checks using alternative CSDID estimators and an instrumental variable (IV) approach. Specifically, we use three instruments: i) the layout of China’s historical railway network in 1961; ii) hypothetical least-cost path (LCP) spanning tree networks; and iii) recentred market access (MA) growth, constructed following Borusyak and Hull (2023). Across all specifications, the results remain stable: HSR access reduces agricultural labour and cropland, but raises productivity enough to sustain agricultural output.
High-speed rail expansion raises agricultural productivity via industrial growth
We then explore the channels through which HSR access raises agricultural TFP.HSR connectivity boosts local GDP and government revenue in connected rural counties, primarily due to the growth in industrial output. Thanks to the ‘Industry Nurturing Agriculture’ policy, these gains are partly channelled back into the agricultural sector through providing financial assistance to rural households and collectives, increasing investments in agricultural infrastructure, and improving rural road infrastructure.
At the same time, lower transportation costs associated with HSR access facilitate farmers’ participation in technical training and encourage the establishment of new agribusiness firms. Household-level evidence further shows that farmers in HSR-connected areas increasingly rent agricultural machines to cope with reduced labour, and shift towards higher-value agricultural production. By improving farmers’ access to larger and more profitable markets, HSR connections raise returns to agricultural production, thereby strengthening farmers’ economic incentives to invest in productivity-enhancing practices. Together, these factors contribute to the overall improvements in agricultural TFP.
Policy implications for land transport infrastructure
Our findings carry important policy implications, suggesting that large-scale transport infrastructure need not undermine agriculture, even in economies undergoing rapid urbanisation and industrialisation. When embedded in a supportive policy environment, high-speed rail can facilitate structural transformation while sustaining agricultural productivity and food security. The key challenge for policymakers is not to resist the reallocation of labour and land, but to manage these transitions in ways that promote productivity and long-term agricultural resilience. These lessons are especially relevant for developing countries, given their continued dependence on agriculture and the projection that most future global land transport infrastructure will largely occur in these nations.
References
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