↑ top

Is Bus versus Rail Investment a Zero-Sum Game?: The Misuse of the Opportunity-Cost Concept

Is Bus versus Rail Investment a Zero-Sum Game?: The Misuse of the Opportunity-Cost Concept

Problem, research strategy, and findings: Bus and rail transit are often assumed to compete for the same pot of transit dollars, with one, therefore, substituting for another. Advocates for each mode lobby accordingly. However, this article presents evidence that spending on the two transit services may be unrelated or even complementary, based on a multivariate analysis of transit spending in the 55 largest U.S. metropolitan statistical areas from 1992 through 2006.

In all the estimated models, using a robust set of controls and statistical strategies, bus spending is positively associated with rail spending; that is, spending on the two modes rise or fall together. This supports the argument that, over the long term, rail investment does not come at the expense of bus investment; the existence of a tradeoff between the modes in investment spending is not supported.

Author: Jonathan Levine
Publication: Journal of the American Planning Association
Published: April 2013
http://www.tandfonline.com/doi/abs/10.1080/01944363.2013.785285