The Effects of Railway Investments in a Polycentric City

Tinbergen Institute Discussion Paper No. TI 04-089/3

31 Pages Posted: 21 Aug 2004

See all articles by Ghebreegziabiher Debrezion

Ghebreegziabiher Debrezion

Tinbergen Institute

Eric A. J. H. Pels

Vrije Universiteit - Department of Spatial Economic

Piet Rietveld

VU University Amsterdam - Department of Spatial Economics (Deceased)

Date Written: April 2004

Abstract

This paper analyses the effect of railway investment on land prices and land use in a polycentric city under various regulatory regimes of land markets. The introduction of a faster mode of transport (train), accessible in discrete locations leads to an extended city size. The stations of the "fast" mode attract dense residential settlements. As a result, the average residential and commercial land rents increase in both the competitive and segmented land market situations, as compared with the "slow" unimodal transport case. When rail investments only serve one particular centre, this leads to the growth of the advantaged centre at the expense of the other centre. Generally speaking, investment in the fast mode results in city growth and increase in rent receipts. However the effect of the investment for individual centres and their corresponding residential areas depends on the underlying land market assumptions and the level of investment. Distorted land markets lead to increases in commercial rents, but this is more than off-set by the decrease in residential land rent.

JEL Classification: R14, R40

Suggested Citation

Debrezion, Ghebreegziabiher and Pels, Eric A.J.H. and Rietveld, Piet, The Effects of Railway Investments in a Polycentric City (April 2004). Tinbergen Institute Discussion Paper No. TI 04-089/3, Available at SSRN: https://ssrn.com/abstract=578821 or http://dx.doi.org/10.2139/ssrn.578821

Ghebreegziabiher Debrezion (Contact Author)

Tinbergen Institute ( email )

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

Eric A.J.H. Pels

Vrije Universiteit - Department of Spatial Economic ( email )

De Boelelaan 1105
1081HV Amsterdam
Netherlands
+31-20-4446049 (Phone)
+31-20-4446004 (Fax)

Piet Rietveld

VU University Amsterdam - Department of Spatial Economics (Deceased)

De Boelelaan 1105
1081HV Amsterdam
Netherlands
+31 20 4446097 (Phone)
+31 20 4446004 (Fax)

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