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Motorization in developing countries: Causes, consequences, and effectiveness of policy options


  • Kutzbach, Mark J.


This paper examines the rise in car use and decline in bus use in developing countries using a theoretical, mode choice model and numerical simulations. The empirical literature points to rising per capita income as a primary determinant of rising motor vehicle use, known as motorization. This analysis of commuter car/bus mode choice shows that in addition to rising income, other factors may drive rising car use at the urban level. First, greater income inequality increases car use if car use is still low, and reduces car use if it is already high. Second, traffic congestion hinders buses more than cars, causing positive feedback between car use and travel time that reduces bus use and contributes to its abrupt collapse. Third, policy interventions to reduce congestion in urban areas, such as tolling car use and reserving lanes for buses, increase consumer surplus by maintaining bus service as an alternate travel mode, even as incomes rise. Socially optimal reserved bus lanes may achieve most of the gains from a socially optimal toll on car use.

Suggested Citation

  • Kutzbach, Mark J., 2009. "Motorization in developing countries: Causes, consequences, and effectiveness of policy options," Journal of Urban Economics, Elsevier, vol. 65(2), pages 154-166, March.
  • Handle: RePEc:eee:juecon:v:65:y:2009:i:2:p:154-166

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    References listed on IDEAS

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    Cited by:

    1. Tarun Mittal & Charan Singh, 2015. "Smart Urban Mobility: Road Less Travelled," Working Papers id:6944, eSocialSciences.
    2. Hultkrantz, Lars & Liu, Xing, 2012. "Green cars sterilize congestion charges: A model analysis of the reduced impact of Stockholm road tolls," Transport Policy, Elsevier, vol. 21(C), pages 110-118.
    3. repec:eee:juecon:v:102:y:2017:i:c:p:106-122 is not listed on IDEAS
    4. Hultkrantz, Lars & Nilsson, Jan-Eric & Arvidsson, Sara, 2012. "Voluntary internalization of speeding externalities with vehicle insurance," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(6), pages 926-937.
    5. Paul J. Burke, 2014. "Green Pricing in the Asia Pacific: An Idea Whose Time Has Come?," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 1(3), pages 561-575, September.
    6. Parry, Ian W.H. & Timilsina, Govinda R., 2010. "How should passenger travel in Mexico City be priced?," Journal of Urban Economics, Elsevier, vol. 68(2), pages 167-182, September.
    7. Zhou, Jiangping, 2014. "From better understandings to proactive actions: Housing location and commuting mode choices among university students," Transport Policy, Elsevier, vol. 33(C), pages 166-175.


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