Effects of Gas Prices on Transit Ridership Vary by Mode, in Combination with Price Ranges and Response Time

SAN JOSE, Calif., Dec. 8, 2014 /PRNewswire-USNewswire/ -- Transit agencies should prepare for ridership increases when gasoline prices increase. However, the net effect varies depending on the transit mode, the range of gasoline prices, and response time. That is the conclusion of the Mineta Transportation Institute's latest peer-reviewed research report, Net Effects of Gasoline Price Changes on Transit Ridership in U.S. Urban Areas. The study focused on ten US census urbanized areas from 2002-2011 and provided information that could help transit agencies prepare to accommodate higher transit travel needs through pricing strategies, general financing, capacity management, and operations planning of transit services during times of substantial gasoline price increases. Principal investigator was Hiroyuki Iseki, PhD, working with Rubaba Ali, both from the University of Maryland, College Park. The free report can be downloaded from http://transweb.sjsu.edu/project/1106.html    

"While previous studies have been published, this report improved on the four specifications of panel data regression analysis and other factors to obtain more robust results that can be generalized," Dr. Iseki said, "A ridership increase may be good news for transit agencies during the off-peak periods, but even a small percentage of ridership increase can require a substantial increase in service supply and facility capacity during the peak periods, when the service level is at or near the maximum supply capacity. If transit agencies can anticipate when and at what levels those ridership increases could reach, they can plan their services more accurately."

The results of this study suggest that transit agencies should prepare for a potential increase in ridership during peak periods that can be generated by substantial gasoline price increases over $3 per gallon for bus and commuter rail modes, and over $4 per gallon for light rail.

The two main variables analyzed in this study are: (1) monthly average gasoline prices based on weekly prices of three different types of gasoline – regular, midgrade, and premium – collected from the U.S. Energy Information Administration, and (2) monthly unlinked passenger trips obtained from the Federal Transit Administration's National Transit Database from January 2002 to December 2011 for Boston, Chicago, Cleveland, Denver, Houston, Los Angeles, Miami, New York, San Francisco, and Seattle. In addition to several important variables related to transit service and demographics, the research team accounted for factors that were not comprehensively included in previous studies, such as the effects of number of recent immigrants, highway miles, and unemployment rate. This study also examines the endogeneity problem in regression analysis that potentially arises from the simultaneity issue between transit service supply and ridership, and estimates the short- and long-term effects of gasoline prices as well as the threshold effects of $3 and $4 marks on transit ridership for bus, light rail, heavy rail, commuter rail, and these four modes combined.

Download the full report: The 125-page report, including ten figures and 25 tables, is available for free, no-registration download at http://transweb.sjsu.edu/project/1106.html.  

Tweet this: #Mineta research on #gas prices shows rider correlation to four #transit modes. Good info for transit ops. http://ow.ly/ESsET

ABOUT THE PRINCIPAL INVESTIGATORS
Hiroyuki Iseki, PhD, is an assistant professor of urban studies and planning and a research faculty at the National Center for Smart Growth Research and Education of the University of Maryland, College Park. His research and teaching interests include transportation economics and finance, public transit planning and management, travel behavior analysis and modeling, sustainable transportation, regional transportation planning, and applications of GISs to research and practice in public policy and planning. He earned an MA and a PhD in urban planning from the University of California, Los Angeles. For more information, see www.arch.umd.edu/ursp/faculty/hiroyuki-iseki and www.smartgrowth.umd.edu/hiseki.html.  

Rubaba Ali is a PhD candidate at the department of Agricultural and Resource Economics at the University of Maryland, College Park. Her research interests include impact of transport infrastructure on agricultural and non-agricultural sectors and overall welfare in developing countries. She conducts research on energy and transport-related issues in developing and developed countries. She received master's degrees in economics and in agricultural and resource economics from the University of Maryland, and undergraduate degrees in mathematics and economics from Bard College.

ABOUT THE MINETA TRANSPORTATION INSTITUTE
The Mineta Transportation Institute (MTI) conducts research, education, and information transfer programs regarding surface transportation policy and management issues, especially related to transit. Congress established MTI in 1991 as part of the Intermodal Surface Transportation Efficiency Act. MTI won national re-designation competitions in 2002, 2006 and 2012. The Institute is funded through the US Secretary of Transportation's Research and Technology Office, US Department of Homeland Security's Transportation Security Administration, the California Department of Transportation's Division of Research, Innovation and Systems Development, and public and private grants. In 2006 the US Department of Homeland Security selected MTI as a National Transportation Security Center of Excellence. The internationally respected members of the MTI Board of Trustees represent all major surface transportation modes. MTI, the lead institute for the nine-university Mineta National Transit Research Consortium, is affiliated with San Jose (CA) State University's College of Business. Visit transweb.sjsu.edu

Contact: Donna Maurillo
MTI Communications Director
831-234-4009 (mobile)
donna.maurillo (at) sjsu.edu

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SOURCE Mineta Transportation Institute

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