Time savings vs Access-based Benefit Assessment of New York’s Second Avenue Subway

Yadi Wang and David Levinson ()
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David Levinson: TransportLab, School of Civil Engineering, University of Sydney

Working Papers from University of Minnesota: Nexus Research Group

Abstract: Under the current practice of benefit-cost analysis, the direct economic benefits produced by a newly built transit facility are assessed based on how it affects travel time and various costs that are associated with transport needs and travel behavior. However, the time-saving-based benefit calculation approach has been questioned and criticized. Given the strong correlation between accessibility and land value, we propose the access-based land value benefit assessment as an alternative, and apply this assessment method to analyzing the Second Avenue Subway project in Manhattan, New York. The primary principle of the access-based method is that the economic value of a transport project’s intangible gains is largely capitalized by nearby properties’ value appreciation, which is directly caused by improved transport accessibility. We find that: (i) the actual travel time saving is lower than originally forecast; (ii) a strong positive correlation between residential property value and job accessibility by transit is observed; (iii) the appreciation in sold property value and rented property value both far exceed total project cost; and (iv) such results support the decision to approve and construct the Second Avenue Subway.

Keywords: transportation; accessibility (search for similar items in EconPapers)
JEL-codes: R40 (search for similar items in EconPapers)
Date: 2022
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Published in Journal of Benefit-Cost Analysis, 13(1) 120–147 (2022)

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https://doi.org/10.1017/bca.2022.3 First version, 2022 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:nex:wpaper:transportist-2022-secondave-12

DOI: 10.1017/bca.2022.3

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