20. Urban Rail Transit Expansions

Between 1970 and 2000, governments have spent more than $25 billion to establish or expand rail transit infrastructure in 16 major MSAs in the United States. Massive funds have also been invested to maintain and improve existing rail lines. In their paper “Effects of Urban Rail Transit Expansions: Evidence from Sixteen Cities, 1970–2000”, published in 2005 in the Brookings-Wharton Papers on Urban Affairs, Baum-Snow and Kahn evaluate the effectiveness of this spending. With all of this money being spent, Baum-Snow and Kahn set out to answer the question: To what extent has rail transit investments triggered new ridership? Through the use of regression, the authors create a theoretical model to evaluate commuting mode choice adjustments as a result of new rail transit construction. Heterogeneous responses of the public in regards to public transit use of new rail infrastructure are then gathered after using explanatory variables such as the year the system was built, distance to the city center, and physical structure of the metropolitan area as a whole. These results are then used to quantify the welfare benefits and draw conclusions about how successful rail transit projects are across certain cities in the United States. By building off of prior studies and studying 16 U.S. cities throughout 1970–2000, this paper also sheds light on the importance of the variation in the decentralization of MSAs and how city structures impact commuting mode choice in response to new rail infrastructure.