Insights / Research BriefApr 03, 2024

Optimal Urban Transportation Policy: Evidence from Chicago

Milena Almagro, Felipe Barbieri, Juan Camilo Castillo, Nathaniel Hickok, Tobias Salz
In Chicago, welfare would be increased by charging almost nothing for public transit, increasing the frequency of trains, and lowering the frequency of buses. Road pricing reduces environmental externalities, but only benefits travelers if the revenues are used for transit subsidies and rebates.