IDEAS home Printed from https://ideas.repec.org/a/inm/ormnsc/v67y2021i1p297-316.html
   My bibliography  Save this article

The Last Mile Matters: Impact of Dockless Bike Sharing on Subway Housing Price Premium

Author

Listed:
  • Junhong Chu

    (Department of Marketing, National University of Singapore, Singapore 119245;)

  • Yige Duan

    (Vancouver School of Economics, Faculty of Arts, University of British Columbia, Vancouver V6T 1L4, British Columbia, Canada;)

  • Xianling Yang

    (Lianjia Research Institute, Kongbai (Beijing) Technology Company Limited, Beijing 100094, China)

  • Li Wang

    (Lianjia Research Institute, Kongbai (Beijing) Technology Company Limited, Beijing 100094, China)

Abstract

Dockless bike sharing provides a convenient and affordable means of transport for urban residents. It solves the “last-mile problem” in public transport by reducing the travel cost between home and subway stations and thus increasing the attractiveness of distant apartments. This may affect the relationship between housing price and distance to subway and reduce the price premium enjoyed by proximate apartments. Using resale apartment data in 10 major cities in China, a difference-in-differences approach at the apartment level, and a two-step estimator at the city-month level, we find that the entry of bike sharing reduces the housing price premium by 29% per km away from a subway station. The effect is equivalent to a reduction of 1,893–2,127 CNY (282–317 USD) in commuting costs per household per annum over 30 years. The effect is driven by a relative increase in the listing price of, and in the demand for, apartments distant from vis-à-vis proximate to subway stations.

Suggested Citation

  • Junhong Chu & Yige Duan & Xianling Yang & Li Wang, 2021. "The Last Mile Matters: Impact of Dockless Bike Sharing on Subway Housing Price Premium," Management Science, INFORMS, vol. 67(1), pages 297-316, January.
    • Handle: RePEc:inm:ormnsc:v:67:y:2021:i:1:p:297-316
    DOI: 10.1287/mnsc.2019.3550
    as

    Download full text from publisher

    File URL: https://doi.org/10.1287/mnsc.2019.3550
    Download Restriction: no
    File URL: https://libkey.io/10.1287/mnsc.2019.3550?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. M. Keith Chen & Judith A. Chevalier & Peter E. Rossi & Emily Oehlsen, 2019. "The Value of Flexible Work: Evidence from Uber Drivers," Journal of Political Economy, University of Chicago Press, vol. 127(6), pages 2735-2794.
    2. Hanming Fang & Quanlin Gu & Wei Xiong & Li-An Zhou, 2016. "Demystifying the Chinese Housing Boom," NBER Macroeconomics Annual, University of Chicago Press, vol. 30(1), pages 105-166.
    3. Kaiji Chen & Yi Wen, 2017. "The Great Housing Boom of China," American Economic Journal: Macroeconomics, American Economic Association, vol. 9(2), pages 73-114, April.
    4. Fesselmeyer, Eric & Liu, Haoming, 2018. "How much do users value a network expansion? Evidence from the public transit system in Singapore," Regional Science and Urban Economics, Elsevier, vol. 71(C), pages 46-61.
    5. Stephen G. Donald & Kevin Lang, 2007. "Inference with Difference-in-Differences and Other Panel Data," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 221-233, May.
    6. Yongheng Deng & Randall Morck & Jing Wu & Bernard Yeung, 2015. "China’s Pseudo-monetary Policy," Review of Finance, European Finance Association, vol. 19(1), pages 55-93.
    7. Gibbons, Stephen & Machin, Stephen, 2005. "Valuing rail access using transport innovations," Journal of Urban Economics, Elsevier, vol. 57(1), pages 148-169, January.
    8. Belinda Archibong & Francis Annan, 2017. "Disease and Gender Gaps in Human Capital Investment: Evidence from Niger's 1986 Meningitis Epidemic," American Economic Review, American Economic Association, vol. 107(5), pages 530-535, May.
    9. Judd Cramer & Alan B. Krueger, 2016. "Disruptive Change in the Taxi Business: The Case of Uber," American Economic Review, American Economic Association, vol. 106(5), pages 177-182, May.
    10. Guangyu Cao & Ginger Zhe Jin & Li-An Zhou, 2018. "Market Expanding or Market Stealing? Platform Competition in Bike-Sharing," Working Papers id:12907, eSocialSciences.
    11. Guangyu Cao & Ginger Zhe Jin & Xi Weng & Li‐An Zhou, 2021. "Market‐expanding or Market‐stealing? Competition with network effects in bike‐sharing," RAND Journal of Economics, RAND Corporation, vol. 52(4), pages 778-814, December.
    12. Berger, Thor & Chen, Chinchih & Frey, Carl Benedikt, 2018. "Drivers of disruption? Estimating the Uber effect," European Economic Review, Elsevier, vol. 110(C), pages 197-210.
    13. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    14. Wang, Mingshu & Zhou, Xiaolu, 2017. "Bike-sharing systems and congestion: Evidence from US cities," Journal of Transport Geography, Elsevier, vol. 65(C), pages 147-154.
    15. Junhong Chu & Haoming Liu & I. P. L. Png, 2018. "Nonlabor Income and Age at Marriage: Evidence From China’s Heating Policy," Demography, Springer;Population Association of America (PAA), vol. 55(6), pages 2345-2370, December.
    16. Hall, Jonathan D. & Palsson, Craig & Price, Joseph, 2018. "Is Uber a substitute or complement for public transit?," Journal of Urban Economics, Elsevier, vol. 108(C), pages 36-50.
    17. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-In-Differences Estimates?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(1), pages 249-275.
    18. Coulson, N. Edward & Engle, Robert F., 1987. "Transportation costs and the rent gradient," Journal of Urban Economics, Elsevier, vol. 21(3), pages 287-297, May.
    19. Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-1278, December.
    20. Konstantinos Pelechrinis & Christos Zacharias & Marios Kokkodis & Theodoros Lappas, 2017. "Economic impact and policy implications from urban shared transportation: The case of Pittsburgh’s shared bike system," PLOS ONE, Public Library of Science, vol. 12(8), pages 1-21, August.
    21. Baum-Snow, Nathaniel & Kahn, Matthew E., 2000. "The effects of new public projects to expand urban rail transit," Journal of Public Economics, Elsevier, vol. 77(2), pages 241-263, August.
    22. Bowes, David R. & Ihlanfeldt, Keith R., 2001. "Identifying the Impacts of Rail Transit Stations on Residential Property Values," Journal of Urban Economics, Elsevier, vol. 50(1), pages 1-25, July.
    23. Dewees, D. N., 1976. "The effect of a subway on residential property values in Toronto," Journal of Urban Economics, Elsevier, vol. 3(4), pages 357-369, October.
    24. Peter Cohen & Robert Hahn & Jonathan Hall & Steven Levitt & Robert Metcalfe, 2016. "Using Big Data to Estimate Consumer Surplus: The Case of Uber," NBER Working Papers 22627, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pradeep K. Chintagunta & Junhong Chu, 2021. "Geography as branding: Descriptive evidence from Taobao," Quantitative Marketing and Economics (QME), Springer, vol. 19(1), pages 53-92, March.
    2. Huang, Sen & Liu, Kanglin & Zhang, Zhi-Hai, 2023. "Column-and-constraint-generation-based approach to a robust reverse logistic network design for bike sharing," Transportation Research Part B: Methodological, Elsevier, vol. 173(C), pages 90-118.
    3. Nie, Rong & Song, Jinbo & Carneiro, Juliana, 2024. "Does emissions data disclosure of Waste-to-Energy incineration plants mitigate NIMBYism concerns? Evidence from the housing market," The Warwick Economics Research Paper Series (TWERPS) 1527, University of Warwick, Department of Economics.
    4. Dong, Zhongpeng & Fan, Zhi-Ping & Wang, Ningning, 2023. "An analysis of pricing strategy for bike-sharing services: The role of the inconvenience cost," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 175(C).
    5. Li, Yang & Sun, Hao & Sun, Panfei & Hou, Dongshuang, 2023. "Inhibit violations in business-to-peer product sharing via heterogeneous punishment, firm decisions and subsidies," European Journal of Operational Research, Elsevier, vol. 311(3), pages 1173-1187.
    6. Guoying Deng & Xuyuan Zhang, 2024. "Platform-Mediated Consolidation and Offline Store Expansion: Evidence from Real Estate Brokerages in Major Chinese Cities," Papers 2409.04326, arXiv.org.
    7. Yilin Bi & Jiangwei Liu & Zhuang Liu & Suhao Wei, 2024. "Impact of New Energy Vehicle Charging Point Subsidy Policy on Subway Demand: Evidence from Beijing’s Real Estate Market," Sustainability, MDPI, vol. 16(9), pages 1-18, May.
    8. Sangwan Lee, 2022. "An In-Depth Understanding of the Residential Property Value Premium of a Bikesharing Service in Portland, Oregon," Land, MDPI, vol. 11(9), pages 1-16, August.
    9. Hai Long Duong & Junhong Chu & Dai Yao, 2023. "Taxi Drivers’ Response to Cancellations and No-Shows: New Evidence for Reference-Dependent Preferences," Management Science, INFORMS, vol. 69(1), pages 179-199, January.
    10. Zhengyi Zhou & Hongchang Li & Anming Zhang, 2024. "Does Bike Sharing increase House Prices? Evidence from Micro-level Data and the Impact of COVID-19," The Journal of Real Estate Finance and Economics, Springer, vol. 69(4), pages 621-650, November.
    11. Guangyu Cao & Ginger Zhe Jin & Xi Weng & Li‐An Zhou, 2021. "Market‐expanding or Market‐stealing? Competition with network effects in bike‐sharing," RAND Journal of Economics, RAND Corporation, vol. 52(4), pages 778-814, December.
    12. Yakubu Suleiman & Adeyemi Ajayi & Sule Abass & Ogunbajo Rukaiyyat, 2020. "The Relationship Between Road Infrastructure Budgetary Expenditures and Commercial Property Investment Returns. Case Study of Fadikpe Area Minna, Nigeria," Baltic Journal of Real Estate Economics and Construction Management, Sciendo, vol. 8(1), pages 187-196, January.
    13. Guo, Yuhan & Li, Jinning & Xiao, Linfan & Allaoui, Hamid & Choudhary, Alok & Zhang, Lufang, 2024. "Efficient inventory routing for Bike-Sharing Systems: A combinatorial reinforcement learning framework," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 182(C).
    14. Liu, Xize & Chen, Wendong & Chen, Xuewu & Chen, Jingxu & Cheng, Long, 2023. "Analyzing sustainable competitiveness of inter-city coach from the impact of high-speed railway opening in Jiangsu Province, China," Socio-Economic Planning Sciences, Elsevier, vol. 89(C).
    15. Zhan, Zilin & Guo, Yuanyuan & Noland, Robert B. & He, Sylvia Y. & Wang, Yacan, 2023. "Analysis of links between dockless bikeshare and metro trips in Beijing," Transportation Research Part A: Policy and Practice, Elsevier, vol. 175(C).
    16. Shr, Yau-Huo (Jimmy) & Yang, Feng-An & Chen, Yi-Syun, 2023. "The housing market impacts of bicycle-sharing systems," Regional Science and Urban Economics, Elsevier, vol. 98(C).
    17. Zhao, Chunkai & Wang, Yuhang & Ge, Zhenyu, 2023. "Is digital finance environmentally friendly in China? Evidence from shared-bike trips," Transport Policy, Elsevier, vol. 138(C), pages 129-143.
    18. Dai Yao & Chuang Tang & Junhong Chu, 2023. "A Dynamic Model of Owner Acceptance in Peer-to-Peer Sharing Markets," Marketing Science, INFORMS, vol. 42(1), pages 166-188, January.
    19. Lan, Hao & Moreira, Fernando & Zhao, Sheng, 2023. "Can a house resale restriction policy curb speculation? Evidence from a quasi-natural experiment in China," International Review of Economics & Finance, Elsevier, vol. 83(C), pages 841-859.
    20. He, Xiaozhou & Wang, Qingyi, 2023. "A location-routing model for free-floating shared bike collection considering manual gathering and truck transportation," Socio-Economic Planning Sciences, Elsevier, vol. 88(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ahlfeldt, Gabriel M. & Nitsch, Volker & Wendland, Nicolai, 2019. "Ease vs. noise: Long-run changes in the value of transport (dis)amenities," Journal of Environmental Economics and Management, Elsevier, vol. 98(C).
    2. Gabriel M. Ahlfeldt & Volker Nitsch & Nicolai Wendland, 2019. "Ease versus noise: long-run changes in the value of transport (dis)amenities," CEP Discussion Papers dp1631, Centre for Economic Performance, LSE.
    3. Berger, Thor & Chen, Chinchih & Frey, Carl Benedikt, 2018. "Drivers of disruption? Estimating the Uber effect," European Economic Review, Elsevier, vol. 110(C), pages 197-210.
    4. Agrawal, David R. & Zhao, Weihua, 2023. "Taxing Uber," Journal of Public Economics, Elsevier, vol. 221(C).
    5. Xavier Fageda, 2021. "Measuring the impact of ride‐hailing firms on urban congestion: The case of Uber in Europe," Papers in Regional Science, Wiley Blackwell, vol. 100(5), pages 1230-1253, October.
    6. Gabriel M. Ahlfeldt & Georgios Kavetsos, 2014. "Form or function?: the effect of new sports stadia on property prices in London," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 177(1), pages 169-190, January.
    7. Gabriel M Ahlfeldt, 2013. "If We Build it, Will They Pay? Predicting Property Price Effects of Transport Innovations," Environment and Planning A, , vol. 45(8), pages 1977-1994, August.
    8. Diao, Mi & Leonard, Delon & Sing, Tien Foo, 2017. "Spatial-difference-in-differences models for impact of new mass rapid transit line on private housing values," Regional Science and Urban Economics, Elsevier, vol. 67(C), pages 64-77.
    9. Teulings, Coen N. & Ossokina, Ioulia V. & de Groot, Henri L.F., 2018. "Land use, worker heterogeneity and welfare benefits of public goods," Journal of Urban Economics, Elsevier, vol. 103(C), pages 67-82.
    10. Teulings, Coen & Ossokina, Ioulia V. & de Groot, Henri L.F., 2014. "Welfare Benefits of Agglomeration and Worker Heterogeneity," IZA Discussion Papers 8382, Institute of Labor Economics (IZA).
    11. Gabriel Ahlfeldt & Volker Nitsch & Nicolai Wendland, 2016. "Ease vs. Noise: On the Conflicting Effects of Transportation Infrastructure," CESifo Working Paper Series 6058, CESifo.
    12. Claudio Agostini & Gastón Palmucci, 2006. "Anticipated Capitalization of the Santiago Metro System on Housing Prices," ILADES-UAH Working Papers inv176, Universidad Alberto Hurtado/School of Economics and Business.
    13. John M. Barrios & Yael Hochberg & Hanyi Yi, 2020. "The Cost of Convenience: Ridehailing and Traffic Fatalities," NBER Working Papers 26783, National Bureau of Economic Research, Inc.
    14. Zachary T. Keeler & Heather M. Stephens, 2023. "The capitalization of metro rail access in urban housing markets," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 51(3), pages 686-720, May.
    15. Lam, Chungsang Tom & Liu, Meng & Hui, Xiang, 2021. "The geography of ridesharing: A case study on New York City," Information Economics and Policy, Elsevier, vol. 57(C).
    16. Mosquera, Roberto, 2024. "Stuck in traffic: Measuring congestion externalities with negative supply shocks," Regional Science and Urban Economics, Elsevier, vol. 108(C).
    17. Arthur Grimes & Chris Young, 2010. "Anticipatory Effects of Rail Upgrades: Auckland’s Western Line," Working Papers 10_11, Motu Economic and Public Policy Research.
    18. Yongwook Paik & Christos A. Makridis, 2023. "The social value of a ridesharing platform: a hedonic pricing approach," Empirical Economics, Springer, vol. 64(5), pages 2125-2150, May.
    19. Vickerman, Roger, 2008. "Transit investment and economic development," Research in Transportation Economics, Elsevier, vol. 23(1), pages 107-115, January.
    20. Minkyu Shin & Jiwoong Shin & Soheil Ghili & Jaehwan Kim, 2023. "The Impact of the Gig Economy on Product Quality Through the Labor Market: Evidence from Ridesharing and Restaurant Quality," Management Science, INFORMS, vol. 69(5), pages 2620-2638, May.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:67:y:2021:i:1:p:297-316. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.