Impact of high-speed rail on income inequalities in Italy

This paper investigates the effects of high-speed rail (HSR) on household income inequalities in Italy at the province level. Gini index, both including and excluding rent expenses, is used as dependent variable to evaluate the effects of the policy in the timeframe 2003–2019. Two-way fixed-effects model is employed to measure the relationship, while augmented synthetic control with staggered treatment adoption, and staggered difference-in-differences explore the sensitivity of results. Main findings suggest a general reduction of inequalities among the provinces receiving HSR treatment, but the effect is not long-lasting many years over the policy outset. Heterogeneities arise depending on whether the station is basic-type or multimodal, and whether the treated province is core or intermediate. Small-sized provinces particularly benefited from the HSR introduction, showing a clear potential to pursue economic convergence objectives. Mechanisms analysis shows that HSR induced the reduction of household income inequalities by positively influencing per capita GDP and employment levels.