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Does public transit reduce car travel externalities? Quasi-natural experiments' evidence from transit strikes

Martin W. Adler and Jos van Ommeren ()

Journal of Urban Economics, 2016, vol. 92, issue C, 106-119

Abstract: One of the 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, a city with mild congestion levels. On weekdays, a strike induces travel times to increase only marginally on the highway ring road (0.017min/km) but substantially on inner city roads (0.224min/km). During rush hour, the strike effect is much more pronounced. The congestion relief benefit of public transit is substantial, equivalent to about 80% of the public transit subsidy. We demonstrate that during weekends, travel time does not change noticeably due to strikes. Furthermore, 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 in combination with first-best congestion pricing.

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: 2016
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Working Paper: Does public transit reduce car travel externalities? Quasi-natural experiments' evidence from transit strikes (2015) Downloads
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