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Commuting Subsidies with two Transport Modes

  • Rainald Borck
  • Matthias Wrede

We study a simple model of commuting subsidies with two transport modes. City residents choose where to live and which mode to use. When all land is owned by city residents, one group gains from subsidies what the other loses. With absentee landownership, city residents as a group gain at the expense of landowners. Subsidies toward different modes have different effects, however, for instance, in one case, rich automobile drivers suffer from transit subsidies, while poor transit users may benefit from subsidies to automobiles.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2007/wp-cesifo-2007-04/cesifo1_wp1972.pdf
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1972.

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Date of creation: 2007
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Handle: RePEc:ces:ceswps:_1972
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  1. Brueckner, Jan K., 2005. "Transport subsidies, system choice, and urban sprawl," Regional Science and Urban Economics, Elsevier, vol. 35(6), pages 715-733, November.
  2. Brueckner, Jan K. & Selod, Harris, 2006. "The political economy of urban transport-system choice," Journal of Public Economics, Elsevier, vol. 90(6-7), pages 983-1005, August.
  3. Edward L. Glaeser & Matthew E. Kahn & Jordan Rappaport, 2000. "Why Do the Poor Live in Cities?," NBER Working Papers 7636, National Bureau of Economic Research, Inc.
  4. LeRoy, Stephen F. & Sonstelie, Jon, 1983. "Paradise lost and regained: Transportation innovation, income, and residential location," Journal of Urban Economics, Elsevier, vol. 13(1), pages 67-89, January.
  5. Rainald Borck & Matthias Wrede, 2004. "Political Economy of Commuting Subsidies," Discussion Papers of DIW Berlin 445, DIW Berlin, German Institute for Economic Research.
  6. Richard J. Arnott & Joseph E. Stiglitz, 1980. "Aggregate Land Rents and Aggregate Transport Costs," NBER Working Papers 0523, National Bureau of Economic Research, Inc.
  7. Sasaki, Komei, 1990. "Income class, modal choice, and urban spatial structure," Journal of Urban Economics, Elsevier, vol. 27(3), pages 322-343, May.
  8. Charles A. M. de Bartolome & Stephen L. Ross, 2002. "Who's in Charge in the Inner City? The Conflict Between Efficiency and Equity in the Design of a Metropolitan Area," Working papers 2002-03, University of Connecticut, Department of Economics.
  9. de Bartolome, Charles A. M. & Ross, Stephen L., 2004. "Who's in charge of the central city? The conflict between efficiency and equity in the design of a metropolitan area," Journal of Urban Economics, Elsevier, vol. 56(3), pages 458-483, November.
  10. DeSalvo, Joseph S. & Huq, Mobinul, 1996. "Income, Residential Location, and Mode Choice," Journal of Urban Economics, Elsevier, vol. 40(1), pages 84-99, July.
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