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Chicken or Egg? The PVAR Econometrics of Transportation

Author

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  • Gabriel M. Ahlfeldt
  • Kristoffer Moeller
  • Nicolai Wendland

Abstract

To analyze the mutually dependent relationship between local economic performance and the demand for and supply of transport services, we employ the structural panel VAR method that is popular in the macroeconomic literature, but which has not previously been applied to the modeling of within-city dynamics of transportation. We focus on a within-city panel of Berlin, Germany, during the heyday of the construction of its dense public transit network (1880-1914). Our results suggest that economic outcomes and supply of transport infrastructure mutually determine each other. Both transport demand and supply seem to be driven more by firms than by residents.

Suggested Citation

  • Gabriel M. Ahlfeldt & Kristoffer Moeller & Nicolai Wendland, 2014. "Chicken or Egg? The PVAR Econometrics of Transportation," SERC Discussion Papers 0158, Spatial Economics Research Centre, LSE.
    • Handle: RePEc:cep:sercdp:0158
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    References listed on IDEAS

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    1. Gibbons, Stephen & Machin, Stephen, 2005. "Valuing rail access using transport innovations," Journal of Urban Economics, Elsevier, vol. 57(1), pages 148-169, January.
    2. Gibbons, Stephen & Lyytikäinen, Teemu & Overman, Henry G. & Sanchis-Guarner, Rosa, 2019. "New road infrastructure: The effects on firms," Journal of Urban Economics, Elsevier, vol. 110(C), pages 35-50.
    3. Ahlfeldt, Gabriel M. & Wendland, Nicolai, 2009. "Looming stations: Valuing transport innovations in historical context," Economics Letters, Elsevier, vol. 105(1), pages 97-99, October.
    4. Ahlfeldt, Gabriel M. & Wendland, Nicolai, 2009. "Looming stations: Valuing transport innovations in historical context," Economics Letters, Elsevier, vol. 105(1), pages 97-99, October.
    5. Vasilis Sarafidis & Donald Robertson, 2009. "On the impact of error cross-sectional dependence in short dynamic panel estimation," Econometrics Journal, Royal Economic Society, vol. 12(1), pages 62-81, March.
    6. Gabriel M. Ahlfeldt & Nicolai Wendland, 2013. "How polycentric is a monocentric city? Centers, spillovers and hysteresis," Journal of Economic Geography, Oxford University Press, vol. 13(1), pages 53-83, January.
    7. Choi, In, 2001. "Unit root tests for panel data," Journal of International Money and Finance, Elsevier, vol. 20(2), pages 249-272, April.
    8. M. Hashem Pesaran, 2007. "A simple panel unit root test in the presence of cross-section dependence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(2), pages 265-312.
    9. McMillen, Daniel P., 1996. "One Hundred Fifty Years of Land Values in Chicago: A Nonparametric Approach," Journal of Urban Economics, Elsevier, vol. 40(1), pages 100-124, July.
    10. David Levinson, 2008. "Density and dispersion: the co-development of land use and rail in London," Journal of Economic Geography, Oxford University Press, vol. 8(1), pages 55-77, January.
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    Cited by:

    1. repec:oup:cesifo:v:64:y:2018:i:2:p:216-240. is not listed on IDEAS
    2. Ahlfeldt, Gabriel M. & Pietrostefani, Elisabetta, 2019. "The economic effects of density: A synthesis," Journal of Urban Economics, Elsevier, vol. 111(C), pages 93-107.
    3. Waights, Sevrin, 2018. "Does the law of one price hold for hedonic prices?," LSE Research Online Documents on Economics 86418, London School of Economics and Political Science, LSE Library.
    4. repec:bla:jregsc:v:58:y:2018:i:4:p:728-758 is not listed on IDEAS
    5. Gabriel Ahlfeldt & Volker Nitsch & Nicolai Wendland, 2016. "Ease vs. Noise: On the Conflicting Effects of Transportation Infrastructure," CESifo Working Paper Series 6058, CESifo Group Munich.
    6. repec:spr:lsprsc:v:10:y:2017:i:1:d:10.1007_s12076-016-0171-9 is not listed on IDEAS
    7. Ahlfeldt, Gabriel & Nitsch, Volker & Wendland, Nicolai, 2019. "Ease vs. noise: Long-run changes in the value of transport (dis)amenities," CEPR Discussion Papers 13811, C.E.P.R. Discussion Papers.
    8. Jussila Hammes, Johanna, 2015. "Political economics or Keynesian demand-side policies: What determines transport infrastructure investment in Swedish municipalities?," Research in Transportation Economics, Elsevier, vol. 51(C), pages 49-60.
    9. repec:eee:ecotra:v:14:y:2018:i:c:p:21-30 is not listed on IDEAS
    10. Gabriel M. Ahlfeldt & Volker Nitsch & Nicolai Wendland, 2019. "Ease Versus Noise: Long-Run Changes in the Value of Transport (Dis)amenities," CEP Discussion Papers dp1631, Centre for Economic Performance, LSE.
    11. repec:gam:jsusta:v:10:y:2018:i:8:p:2931-:d:164315 is not listed on IDEAS
    12. repec:eee:trapol:v:61:y:2018:i:c:p:17-25 is not listed on IDEAS
    13. Ahfeldt, Gabriel M. & Pietrostefani, Elisabetta, 2017. "The compact city in empirical research: A quantitative literature review," LSE Research Online Documents on Economics 83638, London School of Economics and Political Science, LSE Library.
    14. repec:eee:transa:v:107:y:2018:i:c:p:1-19 is not listed on IDEAS
    15. Gabriel M. Ahfeldt & Elisabetta Pietrostefani, 2017. "The Compact City in Empirical Research: A Quantitative Literature Review," SERC Discussion Papers 0215, Spatial Economics Research Centre, LSE.
    16. Damian Damianov & Cheng Yan & Xiangdong Wang, 2018. "Measures of mortgage default risk and local house price dynamics ," ERES eres2018_163, European Real Estate Society (ERES).
    17. Odolinski, Kristofer & Wheat , Phillip, 2016. "Dynamics in rail infrastructure provision: maintenance and renewal costs in Sweden," Working papers in Transport Economics 2016:23, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    18. repec:wfo:wstudy:60468 is not listed on IDEAS

    More about this item

    Keywords

    Transport; land use; Berlin; history; panel vector; autoregression;

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • N73 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: Pre-1913
    • N74 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: 1913-

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