The Impact Of The Opening Of High-speed Rail On The Investment Of Remote Subsidiaries

As a new type of infrastructure,the construction and improvement of high-speed rail is conducive to the growth of local economy.The opening of high-speed rail can shorten the travel time between cities,improve the radiation range of cities,and strengthen the communication and contact between cities.Indirectly and more importantly,it promotes the flow of talents and gives enterprises a broader market environment.Existing scholars have studied the economic benefits of high-speed rail from the perspectives of regional economic growth,industrial structure transformation,enterprise innovation and venture capital.The opening of high-speed rail breaks down inter-regional barriers and reduces the cost of inter-regional communication.In view of whether the opening of high-speed rail will promote the remote investment of enterprises,this paper intends to analyze this issue from the point the establishment of remote holding subsidiaries.Trans-investment promotes enterprises to achieve cross-regional resource allocation,optimize the efficiency of factor resource allocation,broaden the business market,and promote the growth and development.The development of enterprises’ remote subsidiaries is affected by many factors,among which the institutional factor is one of the important reasons that hinder the cross-regional development of enterprises.Surprisingly,scholars have found that the improvement of regional trust environment,the development of remote chambers of commerce and the "hometown" complex of executives will promote the development of remote companies.The opening of high-speed rail breaks regional restrictions,reduces transaction costs between regions,and enhances the efficiency of remote supervision of enterprises.Therefore,the data of A-share listed companies are used to make an empirical analysis of the impact of the opening of high-speed rail on the establishment of remote subsidiaries.In this paper,the data of A-share listed companies from 2004 to 2019 are selected.According to the data of participating holding companies in CSMAR database,the number and investment of remote subsidiaries established by listed companies each year are identified and calculated,and whether high-speed rail is connected between prefecture-level cities is taken as the main explanatory variable to empirically analyze the impact of high-speed rail opening on enterprise trans-investment.Empirical analysis suggests that the opening of high-speed rail promotes enterprises to set up subsidiaries in different places,and the parent company will invest more in subsidiaries in other places,indicating that the opening of high-speed rail can break the regional barriers between the two places and promote the company’s cross-regional investment.This paper also analyzes the heterogeneity of the regression results from many angles,and finds that:(1)the impact of high-speed rail opening on private enterprises is more obvious through cross-regional operation,while the impact on state-owned enterprises is relatively small,indicating that the opening of high-speed rail will promote the cross-regional operation of private enterprises.(2)Based on the analysis of industrial types,it is found that the impact of high-speed rail opening on the secondary industry,that is,the manufacturing industry is more obvious.(3)From the point of view of the geographical location of enterprises,enterprises in the central and eastern regions will invest more in different places after the opening of high-speed rail.(4)The impact of the opening of high-speed rail on the areas with a higher degree of marketization is more obvious.In order to ensure the robustness of the conclusion,the robustness of the conclusion is tested from four aspects: the instrumental variable method,the influence of the financial crisis,the change of the measurement method of the opening of high-speed railway and the tendency score matching method.The results report that all these methods verify that the regression results of this paper are robust.From the perspective of the opening of high-speed rail,this paper studies its impact on enterprise trans-investment.The study reported that the opening of high-speed rail broke the inter-regional market segmentation and significantly promoted trans-investment.The research of this paper not only enriches the analytical framework of high-speed rail and regional economic development,but also has important guiding significance for the remote development of enterprises.It is worth noting that China is currently striving to form a domestic big cycle,a development pattern where the international and domestic double cycles promote each other.However,the current domestic market is severely fragmented and the flow of factors is facing many institutional obstacles.This research provides a reference for promoting the flow of factors across regions.