Transit accounts for only 1% of U.S. passenger miles traveled but attracts strong public support. Using a simple choice model, we predict that transit riders are individuals who commute along routes with the most severe roadway delays. Their choices thus have high marginal impacts on congestion. We test this prediction with data from a strike by Los Angeles transit workers. Estimating an RD design, we find that average highway delay increases 47% when transit service ceases. This effect is consistent with our model’s predictions and many times larger than earlier estimates, which have concluded that transit provides minimal congestion relief.
He concludes with an interesting but perhaps short run argument about infrastructure investment:
Using a simple choice model, we show that transit provision should have much larger impacts on traffic congestion than predicted by models that do not incorporate within-city heterogeneity in driving delays. Our regression discontinuity estimates of the effects of a transit strike confirm this prediction, and back-of-the-envelope calculations suggest that the congestion relief externality of a peak-hour transit passenger mile ranges from $1.20 to $4.10. The lower bounds on potential long-run benefits are at least half those values. Contrary to the conclusions in the existing transportation and urban economics literature, the congestion relief benefits alone may justify transit infrastructure investments.