Title

ECONOMIES OF SCALE AND DENSITY IN URBAN RAIL TRANSPORT: EFFECTS ON PRODUCTIVITY

Document Type

Journal Article

Publication Date

2003

Subject Area

land use - urban density, economics - economies of scale, place - urban, mode - rail, mode - tram/light rail, mode - subway/metro

Keywords

Urban transit, Underground railways, Subways, Rail transit, Productivity, Production rate, Output, Light rail transit, Labor productivity, Economies of scale, Economies of density, Economic models, Economic analysis

Abstract

This study seeks to quantify the magnitude of returns to scale and returns to traffic density for urban rail operations, and to identify factors that give rise to productivity change in urban rail transportation. Urban rail systems include subways, light railways and suburban rail systems serving cities. Using data relating to 17 rail systems in cities around the world, the effects of constant and non-constant returns on output and productivity growth are isolated. Estimates reveal constant returns to scale but increasing returns to density. The productivity model shows that total factor productivity growth is created by both non-constant returns and technology effects, and is very important in differentiating the output performance of urban rail systems. Factor substitution and technology are both evident in explaining the variation between firms in rates of labor productivity growth. The methodology developed in this paper can make inter-firm comparison on a more even basis by isolating the sources that give rise to variation in productivity.

Comments

Transportation Research Part E Home Page: http://www.sciencedirect.com/science/journal/13665545