Patrick Chovanec explains why China's buildout of high-speed rail is failing to alleviate the congestion there.

The problem is that high-speed rail is expensive both to build and to operate, requiring high ticket prices to break even. The bulk of the long-distance passenger traffic, especially during the peak holiday periods, is migrant workers for whom the opportunity cost of time is relatively low. Even if they could afford a high-speed train ticket — which is doubtful given their limited incomes — they would probably prefer to conserve their cash and take a slower, cheaper train. If that proves true, the new high-speed lines will only incur losses while providing little or no relief to the existing transportation network.

Instead of shifting people from slower modes of transportation to faster ones, the high-speed rail is pushing commuters downmarket by stealing market share from airlines and by displacing slower, cheaper rail lines and pushing those customers to buses that just congest the roads further.

Another example of the law of unintended consequences. Urban planning isn't easy.