The Congestion Relief Benefit of Public Transit: Evidence from Rome

We estimate the effect of public transport supply on travel times of motor-vehicle and bus users in Rome, Italy. We apply a quasi-experimental methodology exploiting hourly information on public transport service reductions during strikes. We find that a 10 percent reduction in public transit supply increases the travel time of motor-vehicles by about 1.6 percent in the morning peak. The effect on bus travel time is similar. The congestion-relief benefit of public transport is thus sizeable and bus travel time gains account for an important share of it. We also examine the welfare effects of providing bus lanes. All else given, a bus lane reduces bus travel time by at least 29 percent. We find that bus lanes are undersupplied in Rome, despite the potential costs due to reducing capacity available to cars.