The Underground Economy: Tracking the Wider Impacts of the São Paulo Subway System

Eduardo Haddad, Geoffrey Hewings, Alexandre Porsse, Eveline Van Leeuwen and Renato Vieira

No 8-2013, TD NEREUS from Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS)

Abstract: Over one million workers commute daily to São Paulo city center, using different modes of transportation. The São Paulo subway network reaches 74.2 kilometers of length and is involved in around 20% of the commuting trips by public transportation, enhancing mobility and productivity of workers. This paper uses an integrated framework to assess the wider economic impacts of the existing underground metro infrastructure. We consider links between mobility, accessibility and labor productivity in the context of a detailed metropolitan system embedded in the national economy. Simulation results from a spatial computable general equilibrium model integrated to a transportation model suggest positive economic impacts that go beyond the city limits. While 32% of the impacts accrue to the city of São Paulo, the remaining 68% benefit other municipalities in the metropolitan area (11%), in the State of São Paulo (12.0%) and in the rest of the country (45%). The estimated impact on annual Brazilian GDP is equivalent to approximately 65% of the construction cost of the whole network.

Keywords: mobility; accessibility; productivity; economy-wide effects; transportation infrastructure; subway system (search for similar items in EconPapers)
JEL-codes: R10 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2013
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