Economic Development Impacts of High-speed Rail
RCWP 10-007 June, 2010
High-speed rail lines have been built and proposed in numerous countries throughout the world. The advantages of such lines are a higher quality of service than competing modes (air, bus, auto, conventional rail), potentially faster point-to-point times depending on specific locations, faster
loading and unloading times, higher safety than some modes, and lower labor costs. The disadvantage primarily lies in higher fixed costs, potentially higher energy costs than some competing modes, and higher noise externalities. Whether the net benefits outweigh the net costs is an empirical question that awaits determination based on location specific factors, project costs, local demand, and network effects (depending on what else in the network exists). The optimal network design problem is hard (in the mathematical sense of hard, meaning optimal solutions are hard to find because of the combinatorics of the possible different network configurations), so heuristics and human judgment are used to design networks.