Shaping opportunity structures: how transport infrastructure fuels social ventures and reduces income inequality

Abstract

We develop an opportunity structure perspective to understand how the development of transport infrastructure facilitates the creation of social ventures and how both contribute to reducing the income inequality between urban and rural areas. Focusing on the rapid expansion of China’s high-speed rail (HSR) network, we argue that transport infrastructure development shapes social venture creation through three different pathways: facilitating knowledge diffusion, altering social norms, and fostering an entrepreneurial ecosystem, all of which help to reduce regional urban-rural income inequality. Using a unique dataset of 519,684 social ventures in China from 2007 to 2016, we find that the likelihood of launching a social venture is significantly higher in cities with HSR operations compared to those without. This effect is particularly pronounced in coastal provinces relative to interior provinces. Additionally, we discover that both social venture density and rail traffic density contribute to reducing regional urban-rural income inequality, while business venture density tends to increase it.

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