DP6633 Urban Growth and Transportation
We estimate the effects of major roads and public transit on the growth of major cities in the US between 1980 and 2000. We find that a 10% increase in a city?s stock of roads causes about a 2% increase in its population and employment and a small decrease in its share of poor households over this 20 year period. We also find that a 10% increase in a city?s stock of large buses causes about a 0.8% population increase and a small increase in the share of poor households over this period. To estimate these effects we rely on an instrumental variables estimation which uses a 1947 plan of the interstate highway system and an 1898 map of railroads as instruments for 1980 roads.