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Faster, Taller, Better: Transit Improvements and Land Use Policies

Author

Listed:
  • Chen, Liming

    (Asian Development Bank)

  • Hasan, Rana

    (Asian Development Bank)

  • Jiang, Yi

    (Asian Development Bank)

  • Parkhomenko, Andrii

    (University of Southern California)

Abstract

We study the interaction between transit improvements and land use policies in the context of Bengaluru, one of India’s largest cities. The city inaugurated a metro system in 2011. Yet it has low building heights even near metro stations, reflecting low floor-area ratio limits. We construct a rich dataset that includes information on travel times between 198 wards, parcel-level land use, and building heights from satellite images. We then build a quantitative spatial model where heterogeneous workers choose among different commuting modes. The simulations show that the metro system increases citywide output and welfare, even net of costs. However, the net gains are several times larger when floor-area ratio limits are relaxed near metro stations (transit-oriented development) or in the city center. Moreover, the metro and transit-oriented development are complementary—their joint effect on incomes, prices, and welfare is greater than the combined effect of the two policies implemented separately

Suggested Citation

  • Chen, Liming & Hasan, Rana & Jiang, Yi & Parkhomenko, Andrii, 2023. "Faster, Taller, Better: Transit Improvements and Land Use Policies," ADB Economics Working Paper Series 702, Asian Development Bank.
    • Handle: RePEc:ris:adbewp:0702
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    More about this item

    Keywords

    : urban; transit; land use; building heights; transportation; transit-oriented development; spatial equilibrium; development; India;
    All these keywords.

    JEL classification:

    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • R33 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Nonagricultural and Nonresidential Real Estate Markets
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • R42 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government and Private Investment Analysis; Road Maintenance; Transportation Planning
    • R52 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Land Use and Other Regulations

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