This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

« Back to Results

Transportation Competition and Externalities

Paper Session

Friday, Jan. 3, 2020 10:15 AM - 12:15 PM (PDT)

Manchester Grand Hyatt, Gaslamp C
Hosted By: Transportation and Public Utilities Group
  • Chair: T. Edward Yu, University of Tennessee

Perception Versus Reality: The Noise Complaint Effect on Home Values

Jeffrey Cohen
,
University of Connecticut
Felix Friedt
,
Macalester College

Abstract

Aircraft noise pollution adversely affects physical and mental health. Previous research quantifies the costs of this disamenity through the losses that are capitalized into home values. Much of this research relies heavily on spatially restrictive noise contour plots to identify the house price discounts and determine economic damage. We break new ground on this subject by investigating whether actual residential noise complaints more accurately measure the aircraft noise pollution and housing price impacts experienced by residents near Minneapolis-Saint Paul International Airport. Our findings indicate that noise complaints are a reliable measure of residential noise annoyance and have a significant adverse effect on home prices that extends more than twice as far (12 km) as the contour estimates. Reevaluating the economic damages based on our novel results provides consistent evidence that contour-based calculations severely underestimate the aircraft-noise-pollution-induced losses incurred by homeowners and suggest that $134 million of $146 million in damages are borne by residents located outside the regulated Minneapolis contour area.

Does bike sharing increase house prices? Evidence from micro-level data in Shanghai

Zhengyi Zhou
,
Shanghai University of Finance and Economics
Hongchang Li
,
Beijing Jiao Ton University
Anming Zhou
,
University of British Columbia

Abstract

This paper studies the impact of bike sharing on house prices. We combine the order-level records of a major sharing bike company with the house-level listing data and the Baidu Map point-of-interest (POI) data. We find that bike sharing has a negative effect on house prices. For an average house, the net house price premium caused by bike sharing is -0.48% in the post-launch period. However, the interaction of bike sharing with subway stations has an offsetting positive effect, indicating that bike sharing is a good solution to the “last-mile” problem. Unlike subway stations, the interaction between bus stations and bike sharing does not lead to a premium. At an aggregate level, the net effect of bike sharing is positive (negative, respectively) in zones that are close to (far from, respectively) the city center. This is consistent with our micro-level findings, because the density of subway network decreases with the distance from the city center, and that bike-sharing is more likely to be a complement to the subway network in downtown than in the suburbs.

The Determinants of Railroad Pricing: Elasticity of Demand for Transportation Versus the Profitability of Using the Service

Kenneth D. Boyer
,
Michigan State University
Wesley W. Wilson
,
University of Oregon

Abstract

Railroad pricing is generally understood to be based on cost and demand considerations. This paper investigates the pricing of railroad service for transportation of a homogeneous commodity. The uniform nature of the commodity allows us to identify the source of the demand elasticity for the movement that is priced and also allows us to get an indication of the profitability to the shipper of moving the commodity. Using data from the Bakken crude oil boom of 2010-2016, we find that that the profitability to the shipper of moving the commodity is a far more important element determining railroad pricing than are factors that relate to the elasticity of demand for making the haul. We infer that Ramsey Pricing, which emphasizes the elasticity of demand for the movement as a pricing element, plays only a secondary role in railroad pricing. The profit to the shipper of using the service is a more important element.

Competition and Quality Gains: New Evidence from the High-Speed Rails and Airlines

Hanming Fang
,
University of Pennsylvania
Long Wang
,
ShanghaiTech University
Yang (Zoe) Yang
,
Chinese University of Hong Kong

Abstract

This study examines the causal relationship between competition and service quality using the introduction of high-speed rail (HSR) as a clean source of exogenous variation in competition faced by the intercity transportation providers. Utilizing a unique dataset containing the details of all flights departing from Beijing to 113 domestic destinations in China since January 2009, we employ a difference-in-differences approach to study the effects of high-speed rail entry on airlines' service quality (on-time performance) and to identify the channels through which competition stimulates quality. We document two main findings. First, the entry of high-speed rail creates competition for the airline industry and reduces flight delays of the affected flights. Second, the reductions in departure delay, which airlines control mostly, and taxi-in time, which destination airports control, are identified as the sources of the increase in on-time performance.
Discussant(s)
Zhengyi Zhou
,
Shanghai University of Finance and Economics
Jeffrey Cohen
,
University of Connecticut
Charles F. Mason
,
University of Wyoming
Anming Zhang
,
University of British Columbia
JEL Classifications
  • L9 - Industry Studies: Transportation and Utilities
  • L0 - General