Karamychev, V. and Reeven, P. (2015). Subsidies and US Urban Transit Ridership Journal of Transport Economics and Policy, 50(1):1--20.
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Affiliated author
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Publication year2016
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JournalJournal of Transport Economics and Policy
In recent years, operating subsidies in the USA increased considerably in response to public concerns over traffic congestion and air quality. In a panel of more than 600 transit firms over the period from 1991 to 2012, we find no significant relationship between subsidy and ridership. We show that with a larger subsidy, a transit system operates a larger network but less intensively. At the same time, this subsidy influences service supply in such a way that the quality, as perceived by the traveller, suffers. This is reflected by lower costs of production.