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Transportation

Paper Session

Sunday, Jan. 6, 2019 8:00 AM - 10:00 AM

Hilton Atlanta, 218
Hosted By: American Real Estate and Urban Economics Association
  • Chair: Tien Foo Sing, National University of Singapore

Improving Mobility in Developing Country Cities: Evaluating Bus Rapid Transit and Other Policies in Jakarta

Alexander Rothenberg
,
Syracuse University
Arya Gaduh
,
University of Arkansas-Fayetteville
Tadeja Gracner
,
RAND Corporation

Abstract

"In many developing countries, urbanization is proceeding at an astonishing pace, but transport policy decisions have often not anticipated the pace of growth, leading to congestion. This paper uses reduced form and structural techniques to evaluate different transport policy options for reducing congestion in the city of Jakarta. We first study the TransJakarta Bus Rapid Transit (BRT) system, a public transport initiative designed to reduce congestion and improve mobility for the greater Jakarta metropolitan area. To evaluate the system, we compare changes in outcomes for neighborhoods close to BRT stations to neighborhoods close to planned but unbuilt stations. Contrary to anecdotal evidence from other city experiences with BRT systems, we find that the BRT system did not greatly increase transit ridership or reduce motor vehicle ownership. Instead, motorcycle vehicle ownership increased substantially, while ridership in the traditional public bus system fell. Moreover, by taking up scarce road space, the BRT system exacerbated congestion on the routes it served, leading to increased travel times for other modes. To better predict the impacts of counterfactual transport policies, we estimate an equilibrium model of commuting choices with endogenous commuting times. Our findings suggest that improvements to the BRT system would only modestly impact public transit ridership. Instead, implementing congestion pricing or reducing gasoline price subsidies would have a much larger impact on mode and departure time choices."

High-Speed Rail Project, Location-Based Policy and Inclusive Growth: Quantitative Case Study of the Experimental High-Speed Rail Project in China

Xiao Ke
,
Peking University
Justin Yifu Lin
,
Peking University

Abstract

This study investigates the economic impacts of High Speed Rail projects (HSR) for targeted city locations with heavy-industry-based economy, taking the first HSR project in China as a case study. Using the synthetic control method by Abadie et al. (2003, 2010, 2015) to construct appropriate counterfactuals, we find that within our policy evaluation period, most of the HSR cities have experienced sustained increase in real GDP per capita. However, the magnitudes of such HSR impacts are very heterogeneous. As for some locations, the local income level increased between 4.6% and 28.1% on average when compared with the counterfactual non-HSR cities. The rest of the locations received negligible impacts. By comparing employment between HSR cities and their synthetic counterparts, we find that there is structural transformation toward service sector. We do not find any evidence for government intervention or investment-driven HSR impacts when the infrastructure construction period was finished. The results suggest that the first HSR project in China can help heavy-industry-based cities following their comparative advantages to promote industry structural transformation and diversification so to achieve inclusive growth.

The Role of High Speed Rail in Facilitating High Skilled Worker Matching and Interaction

Siqi Zheng
,
Massachusetts Institute of Technology
Xiaofang Dong
,
Xiamen University
Matthew Kahn
,
University of Southern California

Abstract

High skilled workers gain from face to face interactions. If the skilled can move at higher speeds, then knowledge diffusion and idea spillovers are likely to reach greater distances. This paper uses the construction of China's high speed rail (HSR) network as a natural experiment to test this claim. HSR connects major cities, that feature the nation's best universities, to secondary cities. Since bullet trains reduce cross-city commute times, they reduce the cost of face-to-face interactions between skilled workers who work in different cities. Using a data base listing research paper publication and citations, we document a complementarity effect between knowledge production and the transportation network. Co-authors' productivity rises and more new co-author pairs emerge when secondary cities are connected by bullet train to China's major cities.

International Travel Costs and Local Housing Markets

Shihe Fu
,
Xiamen University
Wangyang Lai
,
Shanghai University of Finance and Economics
Elena Irwin
,
Ohio State University

Abstract

This paper identifies the effect of international travel costs on local housing markets. The international travel cost is measured by whether an American city has launched a nonstop flight to a Chinese city. Using differences-in-differences models, we find that after an American airport connected with China via a nonstop flight, the monthly number of Chinese homebuyers in a county nearby the airport increased by about 0.4 (the mean is 0.9); local housing prices at the county level on average increased by $5900 (4%). We also find a significant decrease in the number of local non-Chinese homebuyers, suggesting a displacement effect in the local housing markets by out-of-town homebuyers. Our findings imply that the spatial equilibrium model based on inter-city migration within a country can be largely generalized to international migration. Our study also contributes to the literature on the economics of air travel and out-of-town homebuyers.
Discussant(s)
Stephen Billings
,
University of Colorado
Jing Wu
,
Tsinghua University
Sisi Zhang
,
Jinan University
Changcheng Song
,
National University of Singapore
JEL Classifications
  • R4 - Transportation Economics
  • O1 - Economic Development