[All] NEW: CEPR 2013 Passenger Railways Reduce Road Traffic Externalities

[Carole Clinch]

Lalive R, Luechinger S, Armin S. Does Supporting Passenger Railways Reduce
Road Traffic Externalities? Centre for Economic Policy Research; Discussion
Paper, Series No. 9335. Attached in .pdf and available online at:
www.cepr.org/pubs/dps/DP9335.asp

<http://www.cepr.org/pubs/dps/DP9335.asp>

p 4

Our analysis supports the hypothesis that improvements in the quality of
local passenger transportation cause improvements in the outcome variables
of interest.


   1. First, we find a substantial negative effect of improved passenger
   transportation on road accidents. Because road accidents are exclusively
   the result of road transportation, this finding suggests that increasing
   the frequency of regional passenger railway services reduces road traffic
   (C1).
   2. Second, we observe negative and significant effects of an increase in
   the frequency of service on NO and NO2; the effects on CO are also
   negative, but weaker and imprecisely estimated.
   3. Third, we test the validity of the instrument by placebo regressions
   on SO2 pollution; SO2 is mainly emitted from power stations. We find
   that improving the railway service frequency has no effects on the
   concentration of SO2.
   4. Similarly, we do not find any effect of railway services on O3.
   Again, this is not surprising. Even though road traffic is an important
   source of O3 and CO, NO and NO2 are precursors of O3, the complex
   chemistry of ozone formation often leads to high O3 concentrations far
   away from the emission sources.
   5. Fifth, we find some evidence that the increase in the frequency of
   rail services reduced infant mortality rates.

 Summing up, our analysis supports the idea that improvements in the
quality of railway services can substantially reduce road traffic
externalities.

 P 27-8

This paper exploits regional variation in the supply of railway services to
identify the effects of support for passenger railways on road traffic
externalities.

 The substitution from cars to railways most likely has considerable
effects on other externalities. For instance, the substitution should lead
to less emissions of carbon dioxide, less noise and lower congestion
externalities.

 Regional passenger railway service is heavily subsidized in Germany. Is
this a worthwhile cost to taxpayers? We provide estimates of the monetary
benefits of the 28% expansion in the capacity of regional railway services
between 1994 and 2004. Our estimates indicate that these monetary benefits
are in the same order of magnitude as the costs. While we do not have any
precise figures on the additional subsidies required to finance this
growth, it appears unlikely that these additional funds are much higher
than the corresponding monetary benefits.
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