How much do users value a network expansion? Evidence from the public transit system in Singapore

Author

Eric FESSELMEYER, Singapore Management UniversityFollow
Haoming LIU

Publication Type

Journal Article

Version

publishedVersion

Publication Date

7-2018

Abstract

We estimate the network effects of a public transit system by examining the impact of its expansion on housing prices. Our results show that a major expansion of Singapore's Mass Rapid Transit (MRT) system increased the price of apartments within 0.5 km of a pre-expansion station by 1.8% relative to apartments that were further away from a station. Evaluated at the mean housing price, the expansion increased the value of pre-connected apartments by at least S$455 million in aggregate, which is equivalent to 9% of the estimated S$5 billion cost of the expansion.

Keywords

Public transportation, Housing, Network effects

Discipline

Transportation | Urban Studies and Planning

Research Areas

Applied Microeconomics

Publication

Regional Science and Urban Economics

Volume

71

First Page

46

Last Page

61

ISSN

0166-0462

Identifier

10.1016/j.regsciurbeco.2018.04.010

Publisher

Elsevier

Citation

FESSELMEYER, Eric and LIU, Haoming. How much do users value a network expansion? Evidence from the public transit system in Singapore. (2018). Regional Science and Urban Economics. 71, 46-61.
Available at: https://ink.library.smu.edu.sg/cis_research/4

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.

Additional URL

http://doi.org/10.1016/j.regsciurbeco.2018.04.010