How Do Users Value a Network Expansion? Evidence from the Public Transit System in Singapore
Eric Fesselmeyer () and
Haoming Liu ()
No 10142, IZA Discussion Papers from Institute of Labor Economics (IZA)
We estimate the network externality of a public transit system by examining the effects of its expansion on the housing market. Our results show that a major expansion of Singapore's Mass Rapid Transit (MRT) system increased the price of apartments within 0.5 km of a pre-expansion station by 1.6% to 2.1% relative to apartments that were further away from a station. Evaluated at the mean housing price, the expansion increased the value of pre-connected apartments by at least S$386 million, which is equivalent to about 8% of the estimated S$5 billion cost of the expansion.
Keywords: public transportation; housing; network effects (search for similar items in EconPapers)
JEL-codes: H4 R21 R42 H23 (search for similar items in EconPapers)
Pages: 41 pages
New Economics Papers: this item is included in nep-net, nep-reg, nep-sea, nep-tre and nep-ure
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