Free Public Transport: More Jobs without Environmental Damage?

Mateus Rodrigues, Daniel Da Mata and Vitor Possebom

Papers from arXiv.org

Abstract: We study the effects of a free-fare transport policy implemented by Brazilian localities on employment and greenhouse gas emissions. Using a staggered difference-in-differences approach, we find that fare-free transit increases employment by 3.2% and reduces emissions by 4.1%, indicating that transport policies can decouple economic activity from environmental damage. Our results are driven by workers transitioning from higher-emission to lower-emission sectors instead of being driven by a decline in private transportation use. Cost-benefit analyses suggest that the costly policy only presents net benefits after considering the tax inflows of the increased economic activity and the benefits of reduced carbon emissions.

Date: 2024-10
New Economics Papers: this item is included in nep-ene, nep-env and nep-tre
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