Substitution effects of high-speed railway on carbon mitigation: From theory to empirics

Understanding the substitution effects of public transit developments, such as the introduction of high-speed railway, is critical for advancing carbon abatement and combating global climate change. This study aims to analyze the profound impacts of high-speed railway, specifically the Kyushu Shinkansen in Japan, on the sustainability performance of passenger vehicles. We first build a theoretical model to reveal the underlying mechanisms of substitution effects. Consistent with theoretical predictions, we employ a difference-in-differences approach to examine the causal impact of the high-speed railway rollout on carbon emissions from passenger vehicles in the Kyushu region of Japan. Our findings reveal a notable decrease in carbon emissions per capita from passenger vehicles in regions served by the high-speed railway, compared to those non-serviced areas. Meanwhile, we confirm that these substitution effects are less pronounced in the freight transport sector. This paper not only contributes to the understanding of HSR's energy impact but also provides valuable insights into the broader implications of transportation infrastructure development on sustainable transportation practices.