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Cheaper Rides, Cleaner Skies: The Impact of Free Public Transit Policies on Air Quality in Chinese Pilot Cities

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  • Huyang Chang

    (University of International Business and Economics)

  • Mengdi Liu

    (University of International Business and Economics)

Abstract

Free public transportation poses an air quality paradox. While reduced fares may divert commuters from private vehicle use, potentially lowering emissions, expanded accessibility could simultaneously increase ridership and offset pollution gains. This paper examines the impact of free public transportation in Hebei, China on urban air quality. Using weekly air quality data and a staggered difference-in-differences (DID) design, we find that the policy reduced the concentration of PM2.5 by approximately 12%. Further heterogeneity analysis demonstrates stronger impacts during noncommuting periods, suggesting that free public transportation predominantly substituted leisure travel. The policy’s impact on residents’ choice of travel mode was short-term, mainly through price incentives rather than the formation of green transportation awareness. A back-of-the-envelope analysis indicates that the health benefits derived from the reduction in pollution substantially outweigh the financial costs incurred by the government in implementing the free public transportation policy.

Suggested Citation

  • Huyang Chang & Mengdi Liu, 2025. "Cheaper Rides, Cleaner Skies: The Impact of Free Public Transit Policies on Air Quality in Chinese Pilot Cities," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 88(7), pages 1971-1993, July.
    • Handle: RePEc:kap:enreec:v:88:y:2025:i:7:d:10.1007_s10640-025-00997-9
    DOI: 10.1007/s10640-025-00997-9
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