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Title: The Local Labour Market Effects of Light Rail Transit

Citation Type: Miscellaneous

Publication Year: 2018

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Abstract: US cities have made large investments in light rail transit in recent years. Arguments in favour of light rail construction typically focus on enhancing workers’ access to job opportunities. I analyse the labour market e↵ects of light rail construction in four US metropolitan areas between 2000 and 2013. I propose a new instrumental variable to overcome endogeneity in transit station location. An inclination among transportation planners to extend light rail to the airport introduces a source of quasi-random neighbourhood assignment, enabling causal identification of neighbourhood e↵ects. I find that light rail improves local employment outcomes. Local amenities cause workers to sort within a city, meaning that neighbourhood e↵ects could be the result of endogenous sorting. To estimate distributional consequences and welfare e↵ects, I propose and estimate a structural model of neighbourhood choice. The model is estimated with novel Google navigation data. I find that light rail systems fail to raise aggregate metropolitan employment because induced rent increases repel low skilled workers, displacing them to inaccessible locations.

Url: https://www.justintyndall.com/uploads/2/8/5/5/28559839/tyndall_jmp.pdf

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Authors: Tyndall, Justin

Publisher: University of British Columbia

Data Collections: IPUMS USA

Topics: Labor Force and Occupational Structure, Other

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