Study Critical of California High-Speed Rail Benefits is Flawed

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A much cited essay by the UCLA Anderson Forecast, which concludes that the high-speed rail corridor connecting Tokyo and Osaka did not generate discernible economic benefits to the region it serves, from its opening in 1964 to 1990, is flawed. Based on the findings, the study's authors argue that California's high-speed rail system will not generate the significant economic benefits that the California High Speed Rail Authority's business plan predicts. However, the methodology adopted in the Anderson study is questionable and the comparability of Japan in the 1960s to California in the future is doubtful.

Read Regional Plan Association's critique of Anderson Forecast.

RPA found five problems with the study, which are detailed in this critique.

First, the comparison of economic growth rates is based on a biased selection of the reference group. The study compares the growth rates of major economic centers to small cities, suburbs and rural areas, which would have had very different growth paths even without high-speed rail.

Second, while not having a high-speed rail station in their territories, Japanese prefectures may still have benefited due to their connectivity to high-speed rail via conventional rail and roads.

Third, the economic benefits of HSR would be reaped through an extended period of time, not just in the first year of opening as the authors expect. The authors' expectation to see a spike in GDP growth in the first year of high-speed rail operation is not reasonable.

Fourth, Japan in the 1960s was still an export-led industrial economy, which is very different from California today. Though Shinkansen may not have directly contributed to the freight transport and industrial production, it has played a much more important role in Japan's transition into a knowledge and service economy in the later years of its operation.

Lastly, the urban geography of Japan is fundamentally different than that of California. There is potential in California for high-speed rail to attract commuters from automobiles and denser development around its stations. Unlike in Japan which is already densely populated, high-speed rail could increase densities by bringing transit-oriented communities to California.