Does Rail Transit Investment Encourage Retail Activity?

According to advocates of "New Urbanism," one of the goals of public investment in rail transit is to encourage the growth of mixed-use transit-oriented development, defined as a high-density mix of residential and commercial uses within walking distance of rail stations. In theory, by reducing transportation costs for residents in the surrounding neighborhood, new transit stations should result in increased land values, spurring higher density development and higher-value uses. A fairly broad empirical literature has attempted to identify the impacts of rail transit investments on surrounding neighborhoods, measured by a variety of outcomes, including land values, housing prices, population and housing density, employment composition and population characteristics (Baum-Snow and Kahn 2005; Kahn 2007; Bollinger and Ihlanfeldt 1997; Winston and Maheshri 2007; see also Giuliano and Agarwal 2010 for a thorough review of recent studies). However, almost no research to date has examined the impacts of rail investment on one of the key components of mixed-use development, namely retail activity. As a land use class, retail should be highly compatible with neighborhoods surrounding rail stations: the increased pedestrian traffic generated by transit riders should increase retail business, whereas high traffic may be considered a negative amenity for residential development. Access to retail services, such as grocery stores, pharmacies and restaurants, has important quality of life implications. Therefore to the extent that rail investments improve the quantity or quality of retail, especially in previously low-income neighborhoods, this would represent a valuable social benefit that might serve to justify public expenditures. The proposed study will examine the impact of investments in rail infrastructure on retail activity in several large California cities. Over the past 20 years, five of California's largest metropolitan areas - Los Angeles, Sacramento, San Diego, San Francisco, and San Jose - have expanded existing rail systems or built new ones, offering an opportunity to investigate changes in retail activity surrounding new rail stations and along rail lines. Funding received from this grant will enable me to purchase the license for an extremely rich longitudinal dataset of all retail establishments in California from 1993 to 2007 (the National Establishment Time Series dataset). This research will analyze data from the National Establishment Time Series, which includes an extremely rich longitudinal dataset of all retail establishments in California from 1993 to 2007. By identifying new store formations ("births"), relocation of existing stores, and store closings ("deaths") in areas around rail stations, it can be determined whether new transit stations generate a net growth in retail activity or a redistribution of existing activity. Additionally, the types of retail (by industry sub-sector) that are most affected by transit investments can be identified. Furthermore, there is considerable variation in the types of neighborhoods that have received new transit stops, both within and across MSAs, offering the chance to investigate differential impacts of transit on retail by prior economic and demographic characteristics, such as resident income and racial composition. Variation in the timing of transit investments also allows the ability to test for changes in impacts over time. This project offers a unique opportunity to examine whether public investments in transit have in fact spurred economic development in surrounding neighborhoods, as predicted by advocates of new urbanism, and, in particular, whether low-income neighborhoods that receive transit stations have seen improvements in the type of retail that directly impacts quality of life.

Language

  • English

Project

  • Status: Completed
  • Funding: $89487.00
  • Contract Numbers:

    11-04

  • Sponsor Organizations:

    National Center for Metropolitan Transportation Research

    University of Southern California
    650 Childs Way, RGL 107
    Los Angeles, CA  United States  90089-0626
  • Project Managers:

    Valentine, Victoria

  • Performing Organizations:

    National Center for Metropolitan Transportation Research

    University of Southern California
    650 Childs Way, RGL 107
    Los Angeles, CA  United States  90089-0626
  • Principal Investigators:

    Schuetz, Jennifer

  • Start Date: 20100801
  • Expected Completion Date: 0
  • Actual Completion Date: 20110801
  • Source Data: RiP Project 27262

Subject/Index Terms

Filing Info

  • Accession Number: 01461206
  • Record Type: Research project
  • Source Agency: National Center for Metropolitan Transportation Research
  • Contract Numbers: 11-04
  • Files: UTC, RiP
  • Created Date: Jan 3 2013 1:41PM