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Free Public Transport: More Jobs without Environmental Damage?

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  • Mateus Rodrigues
  • Daniel Da Mata
  • Vitor Possebom

Abstract

We study the effects of a free-fare transport policy implemented by Brazilian localities on employment and greenhouse gas emissions. Using a staggered difference-in-differences approach, we find that fare-free transit increases employment by 3.2% and reduces emissions by 4.1%, indicating that transport policies can decouple economic activity from environmental damage. Our results are driven by workers transitioning from higher-emission to lower-emission sectors instead of being driven by a decline in private transportation use. Cost-benefit analyses suggest that the costly policy only presents net benefits after considering the tax inflows of the increased economic activity and the benefits of reduced carbon emissions.

Suggested Citation

  • Mateus Rodrigues & Daniel Da Mata & Vitor Possebom, 2024. "Free Public Transport: More Jobs without Environmental Damage?," Papers 2410.06037, arXiv.org.
    • Handle: RePEc:arx:papers:2410.06037
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    References listed on IDEAS

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    Cited by:

    1. Hamidoğlu, Ali & Wang, Yuhao & Wang, Hao, 2025. "Transforming energy taxation policy: A dual cooperative game and stochastic frontier approach for sustainable transitions in Canada," Energy, Elsevier, vol. 337(C).

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