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Public transit bus procurement: The role of energy prices, regulation and federal subsidies

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  • Li, Shanjun
  • Kahn, Matthew E.
  • Nickelsburg, Jerry

Abstract

The U.S. public transit system represents a multi-billion dollar industry that provides essential transit services to millions of urban residents. We study the market for new transit buses that features a set of non-profit transit agencies purchasing buses primarily from a few domestic bus makers. In contrast with private passenger vehicles, the fuel economy of public buses has not improved during the last thirty years and is irresponsive to fuel price changes. To understand these findings, we build a model of bus fleet management decisions of public transit agencies that yields testable hypotheses. Our empirical analysis of bus fleet turnover and capital investment highlights the role of energy prices, environmental regulations, and the “Buy America” mandate associated with receiving federal funding to purchase public transit buses.

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  • Li, Shanjun & Kahn, Matthew E. & Nickelsburg, Jerry, 2015. "Public transit bus procurement: The role of energy prices, regulation and federal subsidies," Journal of Urban Economics, Elsevier, vol. 87(C), pages 57-71.
    • Handle: RePEc:eee:juecon:v:87:y:2015:i:c:p:57-71
    DOI: 10.1016/j.jue.2015.01.004
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    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Three New Economics Papers Related to Mitigating Climate Change
      by Matthew E. Kahn in The Reality-Based Community on 2014-03-12 21:20:17
    2. My Three New NBER Papers
      by Matthew Kahn in Environmental and Urban Economics on 2014-03-12 18:11:00
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      by Matthew Kahn in Environmental and Urban Economics on 2015-03-13 05:56:00
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      by Matthew Kahn in Environmental and Urban Economics on 2015-09-04 20:02:00
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    11. "Buy America" under President Trump
      by Matthew Kahn in Environmental and Urban Economics on 2017-01-29 00:36:00
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      by Matthew Kahn in Environmental and Urban Economics on 2017-06-06 19:23:00
    13. An Economist's Look at the NYC Public Transit Budget
      by Matthew Kahn in Environmental and Urban Economics on 2017-07-26 19:33:00
    14. President Trump's Buy America: Lessons from Public Sector Bus Procurement
      by Matthew Kahn in Environmental and Urban Economics on 2017-08-21 20:22:00
    15. Public Sector Pensions Crowd Out Public Sector Investment in Capital and New Workers
      by Matthew Kahn in Environmental and Urban Economics on 2018-04-15 16:54:00

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    Cited by:

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    2. Lee, Dong-Yeon & Elgowainy, Amgad & Vijayagopal, Ram, 2019. "Well-to-wheel environmental implications of fuel economy targets for hydrogen fuel cell electric buses in the United States," Energy Policy, Elsevier, vol. 128(C), pages 565-583.
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    7. Benjamin Leard & Virginia McConnell & Yichen Christy Zhou, 2019. "The Effect of Fuel Price Changes on Fleet Demand for New Vehicle Fuel Economy," Journal of Industrial Economics, Wiley Blackwell, vol. 67(1), pages 127-159, March.
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    11. Chen Yan & Qiong Tong, 2021. "Analysis of the Evolutionary Game between the Government and Urban Rail Transit Enterprises under the Loss-Subsidy Mode: A Case Study of Beijing," Sustainability, MDPI, vol. 13(14), pages 1-21, July.

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    More about this item

    Keywords

    Transit buses; Fuel economy; Buy America; Revealed preference;
    All these keywords.

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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