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ARE BICYCLES GOOD FOR PARIS?

Martin Koning and Pierre Kopp
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Martin Koning: French Institute of Science and Technology for Transport
Pierre Kopp: Panthéon-Sorbonne university Paris I

Articles, 2014, vol. 41, issue 3

Abstract: In 2001, the newly elected Paris Mayor started to implement an active probicycle policy, mainly based on investments in bike paths and on the launching of a bike rental system in July 2007 (Vélibs). This article aims at appraising such a public policy by measuring its welfare impact, expressed as the Net Present Value (NPV) of the overall changes generated over 2007-2010. Faster bikes perform more kilometres in Paris. Some people shift from cars, buses, and subway to bikes and Vélibs. Switching from a passive mode of transportation to bicycle has a positive health impact. The amounts of C02, local pollutants, noise and congestion externalities generated by each mode are also changing. By contrast, the speed of car is slightly reduced, partially because of a narrowed road capacity. Public finance is affected by the change in fiscal revenues collected whereas the bike rental system’s operator (Decaux) realizes some profits. Finally, the pro-bicycle policy has an initial investment cost and a residual value. All these changes are calculated and computed in a same monetary unit. This policy is (slightly) beneficial for society (a total NPV of +136 M€) even if the cost for public finance (-704 M€) is close to the bikers’ benefit (+859 M€). Vélibers are highly subsidized by the city. This policy is also working at the expense of the cars’ drivers (- 286 M€) while positive externalities are not very important (+101 M€) and Decaux’s profits are moderated (+166 M€). Several sensitivity analyses are conducted to identify the key drivers of the policy’s success.

Date: 2014
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