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Public transit bus procurement: The role of energy prices, regulation and federal subsidies

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  • Li, Shanjun
  • Kahn, Matthew E.
  • Nickelsburg, Jerry

Abstract

The U.S. public transit system represents a multi-billion dollar industry that provides essential transit services to millions of urban residents. We study the market for new transit buses that features a set of non-profit transit agencies purchasing buses primarily from a few domestic bus makers. In contrast with private passenger vehicles, the fuel economy of public buses has not improved during the last thirty years and is irresponsive to fuel price changes. To understand these findings, we build a model of bus fleet management decisions of public transit agencies that yields testable hypotheses. Our empirical analysis of bus fleet turnover and capital investment highlights the role of energy prices, environmental regulations, and the “Buy America” mandate associated with receiving federal funding to purchase public transit buses.

Suggested Citation

  • Li, Shanjun & Kahn, Matthew E. & Nickelsburg, Jerry, 2015. "Public transit bus procurement: The role of energy prices, regulation and federal subsidies," Journal of Urban Economics, Elsevier, vol. 87(C), pages 57-71.
  • Handle: RePEc:eee:juecon:v:87:y:2015:i:c:p:57-71
    DOI: 10.1016/j.jue.2015.01.004
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    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. China's Rail Firms Jump the U.S "Buy America Act" Wall
      by Matthew Kahn in Environmental and Urban Economics on 2015-09-04 20:02:00
    2. The Economics of Red State vs. Blue State Carbon Politics
      by Matthew Kahn in Environmental and Urban Economics on 2015-10-23 18:40:00
    3. The Economics of Moving a Public Bus 1 Mile: Unions Raise the Average Cost of Service
      by Matthew Kahn in Environmental and Urban Economics on 2016-03-26 03:22:00
    4. Cutting Edge California Carbon Policy: Nudging Bus Operators to Use Garbage as Fuel
      by Matthew Kahn in Environmental and Urban Economics on 2016-08-19 19:46:00
    5. Is UCLA Transportation Achieving "Carbon Neutrality"?
      by Matthew Kahn in Environmental and Urban Economics on 2016-09-29 02:59:00
    6. Some Airplane Energy Demand Economics
      by Matthew Kahn in Environmental and Urban Economics on 2016-12-01 22:55:00
    7. "Buy America" under President Trump
      by Matthew Kahn in Environmental and Urban Economics on 2017-01-29 00:36:00
    8. Why Are NYC's Subway Trains So Old?
      by Matthew Kahn in Environmental and Urban Economics on 2017-06-06 19:23:00
    9. An Economist's Look at the NYC Public Transit Budget
      by Matthew Kahn in Environmental and Urban Economics on 2017-07-26 19:33:00
    10. President Trump's Buy America: Lessons from Public Sector Bus Procurement
      by Matthew Kahn in Environmental and Urban Economics on 2017-08-21 20:22:00
    11. Public Sector Pensions Crowd Out Public Sector Investment in Capital and New Workers
      by Matthew Kahn in Environmental and Urban Economics on 2018-04-15 16:54:00

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Michael K. Price, 2014. "Using field experiments to address environmental externalities and resource scarcity: major lessons learned and new directions for future research," Oxford Review of Economic Policy, Oxford University Press, vol. 30(4), pages 621-638.
    2. repec:eee:pubeco:v:154:y:2017:i:c:p:95-121 is not listed on IDEAS
    3. Matthew E. Kahn & Jerry Nickelsburg, 2016. "An Economic Analysis of U.S Airline Fuel Economy Dynamics from 1991 to 2015," NBER Working Papers 22830, National Bureau of Economic Research, Inc.
    4. Rhiannon Jerch & Matthew E. Kahn & Shanjun Li, 2016. "Efficient Local Government Service Provision: The Role of Privatization and Public Sector Unions," NBER Working Papers 22088, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    Transit buses; Fuel economy; Buy America; Revealed preference;

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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