01697811

Component

This paper uses data on the location of business units and employment in London to estimate the impact of a new metro line on the spatial distribution of economic activity. The authors' business units level dataset allows them to track the movement of units across space and time, making it possible to estimate the growth and displacement component of the impact. In addition to standard panel fixed effect methods, the authors employ a planned-route instrumental variables methodology which uses planned but abandoned metro alignments. The authors find that areas within walking distance to stations experience a significant positive effect (3.6% more business units and 2.5% more employment), whereas areas further off but still within 2000 meters experience a significant negative impact (−1.3% for business units and−3% for employment). This result provides empirical evidence for the models of both Fujita et al. (1) and Redding and Turner (2) as areas close to the transport scheme but not subject to it are worse off than areas further away. The results suggest that the metro created no new jobs or business units, the scheme merely shifted economic activity closer to the stations. However, sectoral mix changed significantly, favouring high-value-added business sector employment, suggesting that productivity may have increased.

This paper was sponsored by TRB committee ADD10 Standing Committee on Transportation and Economic Development.

19-03039

English

17p

2019

Transportation Research Board 98th Annual Meeting

Digital/other

Figures; References; Tables

Businesses; Economic development; Economic impacts; Employment; Public transit; Rail transit

London (England)

Economics; Public Transportation; Railroads

Transportation Research Board Annual Meeting 2019 Paper #19-03039

TRIS, TRB, ATRI

Dec 7 2018 9:38AM