Saturday, April 10, 2010

Are Urban Rail Systems Good for the Society?

You'll have to agree that this is a great question.

The good thing is that two of the nation's top economists evaluated urban rail systems and have an answer.

In their 2006 study, economists Winston of the Brookings Institution and Maheshri of the University of California at Berkeley concluded as follows:

"We find that with the exception of BART in the San Francisco Bay area, every system actually reduces welfare and is unable to become socially desirable even with optimal pricing or physical restructuring of its network. We conclude rail’s social cost is unlikely to abate because it enjoys powerful political support from planners, civic boosters, and policymakers."

What does their conclusion mean in plain words?
  • Urban rail systems have a negative value for the society, even if a rail system selects the best route and the best fare price.
  • The only reason city rail systems get built is because politicians and special interests are promoting them forcefully. They make a (short term) profit at the expense of society.

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