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Connectivity, Innovation and Business Dynamism

This project aims to study the effect of the development of high-speed railways (HSR) on innovation in france, though its impact on the firms' productivity and dynamism. We focus on high-speed rail infrastructure, since it has an exclusive impact on the mobility of people, not goods, and therefors represents a channel for the flow of ideas and knowledge. We identify the expansion of high-speed railways as a reduction in communication costs between territories, companies, and establishments, facilitating the exchange between parties and increasing the opportunities for new face-to-face interactions, which can boost the productivity of companies and their capacity to innovate. Indeed, the theoretical literature has claimed that these interactions can be beneficial to innovation, to the dynamism of companies and can further lead to economic growth. However, empirical evidence is very recent and remains insufficient for HSR.