Almost fare free: Impact of a cheap public transport ticket on mobility patterns and train delays

During June–August 2022, Germany temporarily reduced the fare of unlimited local and regional public transport nationwide to €9 per month. We study changes in mobility behavior and rail congestion effects induced by this 9-Euro Ticket. We employ difference-in-differences and event-study designs to analyze data from mobile-network devices, administrative traffic counts from road monitoring stations, and train arrival data. We find a strong increase in rail travel with modest substitution away from cars. Train trips rise by around 35%, while car traffic falls by 1–5%, with the smallest traffic reductions during commuting times and the largest increases in rail travel for leisure purposes on weekends and to touristic destinations. Moreover, the train demand surge materially worsens service quality via elevated train delays, which even spill over to long-distance trains. A welfare analysis suggests that the policy mostly acted as a cost-of-living transfer with limited emissions benefits, implying high implicit CO2 government abatement costs. Overall, our findings indicate that deeply discounted, nationwide “go-anywhere” tickets can substantially increase railway travel, yet generate limited car-to-rail substitution and strain service reliability when implemented without accompanying capacity extensions.During June–August 2022, Germany temporarily reduced the fare of unlimited local and regional public transport nationwide to €9 per month. We study changes in mobility behavior and rail congestion effects induced by this 9-Euro Ticket. We employ difference-in-differences and event-study designs to travel data from mobile-network devices, administrative traffic counts from road monitoring stations, and train arrival data. We find a strong increase in rail travel with modest substitution away from cars. Train trips rise by around 35%, while car traffic falls by 1–5%, with the smallest traffic reductions during commuting times and the largest increases in rail travel for leisure purposes on weekends and to touristic destinations. Moreover, the train demand surge materially worsens service quality via elevated train delays, which even spill over to long-distance trains. A welfare analysis suggests that the policy mostly acted as a cost-of-living transfer with limited emissions benefits, implying high implicit CO2 government abatement costs. Overall, our findings indicate that deeply discounted, nationwide “go-anywhere” tickets can substantially increase railway travel, yet generate limited car-to-rail substitution and strain service reliability when implemented without accompanying capacity extensions.