Does Public Transit reduce Car Travel Externalities?

Martin W. Adler and Jos van Ommeren ()
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Martin W. Adler: VU University Amsterdam, the Netherlands

No 15-011/VIII, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: One of the main unanswered questions in the field of urban economics is to which extent subsidies to public transit are justified. We examine one of the main benefits of public transit, a reduction in car congestion externalities, the so-called congestion relief benefit, using quasi-natural experimental data on citywide public transit strikes for Rotterdam. On weekdays, a strike induces car speed to decrease only marginally on the highway ring road (by 3 percent) but substantially on inner city roads (by 10 percent). During rush hour, the strike effect is much more pronounced. The congestion relief benefit is substantial, equivalent to about half of the public transit subsidy. We demonstrate that during weekends, car speed does not change noticeable due to strikes. Further, we show that public transit strikes induce similar increases in number of cyclists as number of car travelers suggesting that bicycling-promoting policies to reduce car congestion externalities might be attractive.

Keywords: transit subsidies; public transit; traffic congestion; congestion relief benefit; strike (search for similar items in EconPapers)
JEL-codes: H76 J52 L92 R41 (search for similar items in EconPapers)
Date: 2015-01-22
New Economics Papers: this item is included in nep-eur, nep-tre and nep-ure
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Citations: View citations in EconPapers (7)

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