High-speed rail and urban income distribution: Evidence from Reggio Emilia, Italy

This paper evaluates whether and how Reggio Emilia's municipal distribution of declared personal income changed after the 2013 opening of the Mediopadana high-speed rail station, focusing on the local tax-filing base rather than on aggregate income alone. Using municipal administrative tax-return data and a two-stage design combining propensity score matching with the synthetic control method, we compare post-2013 trajectories in income-bracket frequencies and declared amounts with a data-driven counterfactual built on pre-opening trends. Relative to its synthetic counterpart, Reggio Emilia exhibits limited demographic divergence but a clear rightward rebalancing of the income distribution. Middle-income and upper-middle-income brackets expand, and the top tail thickens modestly, both in taxpayer counts and in total declared income, while lower-income brackets grow more slowly than in the counterfactual. Average income within brackets remains broadly stable, indicating that the dominant adjustment occurs through changes in the number and composition of taxpayers across brackets, rather than through within-bracket income growth. At the aggregate level, mean declared income is modestly higher than the synthetic path, while inequality indicators point to a more right-skewed distribution in several post-opening years. Lorenz comparisons show no strong or weak dominance, suggesting that the post-opening distribution cannot be ranked unambiguously against the counterfactual. Overall, the findings indicate a stronger but more uneven municipal tax-filing base after the HSR opening. Given grouped income data and a single treated municipality, the results should be read as detailed case-study evidence, directly consistent with tax-base recomposition and bracket-level reclassification, while labour-market integration and residential sorting remain plausible but indirectly observed channels.