IDEAS home Printed from https://ideas.repec.org/p/ces/ceswps/_11956.html

Will New Driving Technologies Change the Value of Public Transportation Investments?

Author

Listed:
  • Imke Reimers
  • Benjamin Reed Shiller

Abstract

We analyze how self-driving vehicles (SDVs) influence commuter behavior and returns to long-lived public transit investments. Using a commuting mode model estimated on detailed home and work location data from Greater Boston, we simulate the widespread entry of SDVs, which offer passive travel similar to transit but use existing road networks. We find that SDVs increase vehicle miles by 40% while decreasing public transit use by about 10%. Transit improvements continue to moderately boost revenues and lower miles driven, but their effects on mileage are small compared to SDVs. These findings highlight planning challenges posed by the emergence of SDVs.

Suggested Citation

  • Imke Reimers & Benjamin Reed Shiller, 2025. "Will New Driving Technologies Change the Value of Public Transportation Investments?," CESifo Working Paper Series 11956, CESifo.
    • Handle: RePEc:ces:ceswps:_11956
    as

    Download full text from publisher

    File URL: https://www.ifo.de/DocDL/cesifo1_wp11956.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Nicholas Buchholz & Laura Doval & Jakub Kastl & Filip Matejka & Tobias Salz, 2025. "Personalized Pricing and the Value of Time: Evidence From Auctioned Cab Rides," Econometrica, Econometric Society, vol. 93(3), pages 929-958, May.
    2. Harish Guda & Upender Subramanian, 2019. "Your Uber Is Arriving: Managing On-Demand Workers Through Surge Pricing, Forecast Communication, and Worker Incentives," Management Science, INFORMS, vol. 67(5), pages 1995-2014, May.
    3. Qu, Xiaobo & Wang, Shuaian & Zhang, Jin, 2015. "On the fundamental diagram for freeway traffic: A novel calibration approach for single-regime models," Transportation Research Part B: Methodological, Elsevier, vol. 73(C), pages 91-102.
    4. Nathaniel Baum-Snow, 2007. "Did Highways Cause Suburbanization?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 122(2), pages 775-805.
    5. Ajay Agrawal & Joshua S. Gans & Avi Goldfarb, 2019. "Artificial Intelligence: The Ambiguous Labor Market Impact of Automating Prediction," Journal of Economic Perspectives, American Economic Association, vol. 33(2), pages 31-50, Spring.
    6. Berry, Steven & Levinsohn, James & Pakes, Ariel, 1995. "Automobile Prices in Market Equilibrium," Econometrica, Econometric Society, vol. 63(4), pages 841-890, July.
    7. Hsu, Wen-Tai & Zhang, Hongliang, 2014. "The fundamental law of highway congestion revisited: Evidence from national expressways in Japan," Journal of Urban Economics, Elsevier, vol. 81(C), pages 65-76.
    8. Hall, Jonathan D. & Palsson, Craig & Price, Joseph, 2018. "Is Uber a substitute or complement for public transit?," Journal of Urban Economics, Elsevier, vol. 108(C), pages 36-50.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lam, Chungsang Tom & Liu, Meng & Hui, Xiang, 2021. "The geography of ridesharing: A case study on New York City," Information Economics and Policy, Elsevier, vol. 57(C).
    2. Christensen, Peter & Osman, Adam, 2021. "The Demand for Mobility: Evidence from an Experiment with Uber Riders," IZA Discussion Papers 14179, IZA Network @ LISER.
    3. Maximilian Schaefer & Kevin Ducbao Tran, 2026. "Airbnb, Hotels, and Localized Competition," Bristol Economics Discussion Papers 26/837, School of Economics, University of Bristol, UK.
    4. repec:diw:diwwpp:dp1889 is not listed on IDEAS
    5. Miquel-Àngel Garcia-López & Ilias Pasidis & Elisabet Viladecans-Marsal, 2022. "Congestion in highways when tolls and railroads matter: evidence from European cities [The congestion relief benefit of public transit: evidence from Rome]," Journal of Economic Geography, Oxford University Press, vol. 22(5), pages 931-960.
    6. Cucu, Florin, 2025. "Roads, internal migration and the spatial sorting of U.S. high-skill workers," Journal of Urban Economics, Elsevier, vol. 146(C).
    7. Tarduno, Matthew, 2021. "The congestion costs of Uber and Lyft," Journal of Urban Economics, Elsevier, vol. 122(C).
    8. Morgan Ubeda, 2020. "Local Amenities, Commuting Costs and Income Disparities Within Cities," Working Papers halshs-03082448, HAL.
    9. Nathaniel Baum-Snow & Matthew A. Turner, 2017. "Transport Infrastructure and the Decentralization of Cities in the People's Republic of China," Asian Development Review, MIT Press, vol. 34(2), pages 25-50, September.
    10. Tarduno, Matthew, 2025. "Elasticities and tax incidence in urban ridesharing markets: Evidence from Chicago," Journal of Urban Economics, Elsevier, vol. 150(C).
    11. Hayato Kanayama & Suguru Otani, 2024. "Nonparametric Estimation of Matching Efficiency and Elasticity in a Spot Gig Work Platform: 2019-2023," Papers 2412.19024, arXiv.org, revised Jun 2026.
    12. Zhi (Aaron) Cheng & Min-Seok Pang & Paul A. Pavlou, 2020. "Mitigating Traffic Congestion: The Role of Intelligent Transportation Systems," Information Systems Research, INFORMS, vol. 31(3), pages 653-674, September.
    13. Redding, Stephen, 2020. "Trade and Geography," CEPR Discussion Papers 15268, Centre for Economic Policy Research.
    14. Fan Wu & Yi Xin, 2024. "Estimating Nonseparable Selection Models: A Functional Contraction Approach," Papers 2411.01799, arXiv.org, revised Jun 2026.
    15. Ioulia V Ossokina & Jos van Ommeren & Henk van Mourik, 2023. "Do highway widenings reduce congestion?," Review of Finance, European Finance Association, vol. 23(4), pages 871-900.
    16. Saharsh Agarwal & Deepa Mani & Rahul Telang, 2023. "The Impact of Ride-Hailing Services on Congestion: Evidence from Indian Cities," Manufacturing & Service Operations Management, INFORMS, vol. 25(3), pages 862-883, May.
    17. Ana Isabel Moreno-Monroy & Frederico Ramos, 2015. "The impact of public transport expansions on informality: the case of the São Paulo Metropolitan Region," ERSA conference papers ersa15p1551, European Regional Science Association.
    18. Li,Shanjun & Xing,Jianwei & Yang,Lin & Zhang,Fan, 2020. "Transportation and the Environment : A Review of Empirical Literature," Policy Research Working Paper Series 9421, The World Bank.
    19. Victor Couture & Jessie Handbury, 2017. "Urban Revival in America, 2000 to 2010," NBER Working Papers 24084, National Bureau of Economic Research, Inc.
    20. Stephen J. Redding, 2024. "Quantitative Urban Economics," NBER Working Papers 33130, National Bureau of Economic Research, Inc.
    21. Chuantao Cui & Leona Shao-Zhi Li, 2019. "High-speed rail and inventory reduction: firm-level evidence from China," Applied Economics, Taylor & Francis Journals, vol. 51(25), pages 2715-2730, May.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_11956. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Klaus Wohlrabe (email available below). General contact details of provider: https://edirc.repec.org/data/cesifde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.