Pro-poor transport subsidies: More user welfare and faster travel

Authors

• Luis A. Guzman
• Jorge Lius Ochoa
• Santiago Gómez Cardona
• Ignacio Sarmiento-Barbieri

Document Type

Journal Article

Publication Date

2025

Subject Area

place - south america, place - urban, mode - bus rapid transit, mode - bus, economics - subsidy, economics - pricing, policy - fares, ridership - behaviour, ridership - modelling

Keywords

Public transport, Discrete choice modeling, Public transport pricing, Travel voucher, Bogotá

Abstract

A previous study has shown limited success of traditional fare discount subsidies in promoting public transport usage among low-income populations in Bogotá, Colombia. This paper evaluates the differential impacts of a novel demand-side subsidy, in the form of public transport vouchers, on user welfare and travel behavior. The study employs a large-scale randomized controlled trial involving 1607 frequent users of Bogotá’s Integrated Public Transport System, half of whom received monthly travel vouchers on their personalized travel cards. The other half acted as a control group. A discrete choice random utility model is utilized to analyze weekly travel patterns and estimate changes in welfare in terms of consumer surplus by gender and travel purpose, based on a panel database that has information on multiple travel choices over 6 months. The results indicate a significant increase in the utility of the BRT and regular bus services for voucher recipients, leading to increased BRT usage, decreased regular bus usage, and travel time savings. The study also finds that travel vouchers notably enhance user welfare, especially for female participants and non-work-related trips, suggesting these trip purposes generate greater user benefits. The findings highlight the potential of voucher-based subsidies to induce behavioral changes and improve welfare, particularly for groups that typically depend more on public transport services.

Rights

Permission to publish the abstract has been given by Elsevier, copyright remains with them.

Comments

Transportation Research Part A Home Page:

http://www.sciencedirect.com/science/journal/09658564

Recommended Citation

Guzman, L. A., Ochoa, J. L., Cardona, S. G., & Sarmiento-Barbieri, I. (2025). Pro-poor transport subsidies: More user welfare and faster travel. Transportation Research Part A: Policy and Practice, 195, 104454.