Forty years of modelling rapid transit’s land value uplift in North America: moving beyond the tip of the iceberg

Document Type

Journal Article

Publication Date

2016

Subject Area

place - north america, mode - bus rapid transit, land use - impacts, land use - transit oriented development, literature review - literature review, economics - value capture

Keywords

Land value uplift, rapid transit, hedonic model, land value capture, accessibility, self-selection, transit-oriented development

Abstract

Identifying and measuring the land value uplift (LVU) impacts of rapid transit are important for a number of reasons. However, despite the general notion that rapid transit does confer positive LVU benefits, our comprehensive and critical review of more than 130 analyses across 60 studies completed in North America over the past 40 years finds significant heterogeneity in research outcomes, leaving many significant questions unanswered. Beyond high-level differences in study inputs, we argue that a fundamental source of variability is a lack of empirical specificity from the use of proximity as the dominant way in which LVU benefits are captured. This use of a proxy leads to the potential for omitted variables and unobserved relationships, and exposes previous work to the potential for misvalued results. To overcome this issue, we outline recommendations for future research, namely a recognition of relative accessibility and the possibility of LVU impacts from transit-oriented development. Incorporating measures related to these factors into LVU models can reveal their implicit prices, resulting in research that is more theoretically inclusive, empirically comprehensive, comparable, and able to provide important information to inform policy analysis and prescription.

Rights

Permission to publish the abstract has been given by Taylor&Francis, copyright remains with them.

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