The Innovation Dividend of High Speed Rail: Evidence from Italy

In this work we analyze the impact of high-speed rail (HSR) connection on regional innovation performance in Italy. Using a balanced panel of 89 NUTS-3 regions observed over the period 1980–2019, we measure innovation with forward citation–weighted patent fractional counts from the EPO PATSTAT database. We conduct a causal analysis that exploits the staggered opening of HSR stations in a extended two-way fixed effects (ETWFE) difference-in-differences (DiD) design. We find that HSR access increases regional innovation by economically large and statistically significant amounts (overall ATT on the order of 0.24–0.33 log points), with dynamics that remain positive several years after openings. A more detailed analysis finds gains along both quality (citations) and extensive margins (patent share and inventors). Moreover, estimates of a dyadic gravity model show that HSR boosts inter-regional inventor collaboration by about 30%, suggesting reduced effective distance as a key mechanism for improved innovative performance, while a social network analysis (SNA) reveals an increase in the degree of centrality in the regional innovation network associated to better HSR access. Sectoral results point to especially strong responses in chemistry, electrical and mechanical engineering.