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Nathaniel Baum-Snow

A higher gas tax? A Brown economist tells why increasing the cost of driving cars, rather than simply expanding mass transit, is the best way to reduce the economic and environmental impact of fossil-fuel consumption.
By Elaine Beebe  |  March 24, 2009  |  Email to a friend

Nathaniel Baum-Snow, the Stephen Robert Assistant Professor of Economics, shares his thoughts on public-transportation solutions for the nation and Rhode Island.

Nathaniel Baum-Snow:   Nathaniel Baum-Snow Baum-Snow’s expertise is in urban economics, public finance, and labor economics. His recent papers on transportation include "Did Highways Cause Suburbanization?" published in the Quarterly Journal of Economics and “Effects of Urban Rail Expansions: Evidence from Sixteen Cities” published in Brookings Papers in Urban Affairs.

A magna cum laude graduate of Harvard College, Baum-Snow earned his Ph.D. in economics from the University of Chicago, where he is currently on sabbatical. In Chicago, he takes public transportation; when at Brown, he walks to work.

After the recent gas-price roller coaster, many policy makers are looking at public-transport solutions to cut down on commuting by car. Is this the way to go?

In most U.S. cities I see little hope that expansion of public transportation infrastructure and route networks can significantly reduce the percentage of commutes made by car in the near term. U.S. development is so spread out that only in a few cities can efficient transit systems hope to serve enough people to make them worth their construction and operating cost. Public transit is essential for serving the poor, but that is probably about as far as it's going to go.

My research indicates that between 1970 and 2000, despite major expansions or establishment of rail transit systems in 16 U.S. cities, the number of people living in metropolitan areas who commuted by public transit fell from 12 percent to 6 percent. My coauthor, Matthew Kahn (now at UCLA), and I found that of the rail systems in those 16 cities, only Washington, D.C.’s, comes anywhere close to passing a cost-benefit analysis. If a city wants to attract riders, the system has to go everywhere and be fast. This is why Washington’s system has been relatively successful.

If not via more public transportation, how would you discourage single-occupant car commuting? How can the government get us out of our cars and into mass transit, or at least car pools?

I don’t think the social goal should be put in terms of getting people to commute less by car. People’s time is valuable, so driving is usually the right commuting choice for them and for us as a society that values productivity at work rather than sitting on the bus or train getting to work. A better way to think about the issue is to determine what the cost to society of people’s driving is and to incentivize people to drive a bit less through higher gas taxes and road tolling. This has been done in Europe, where, though almost every household owns a car, development is much denser and people drive shorter distances than in the United States.

How about in Rhode Island?

Providence has a relatively dense core, so a bus system like RIPTA makes sense. There are not really dense enough pockets of suburban development such that new rail line construction makes much sense to me, with one exception: Expansion of commuter rail along the existing Amtrak line to Kingston, R.I., could be achieved at a fairly low cost.

Should we try to attract suburban professionals and their families back into cities, where they can better utilize public transportation?

People live in the suburbs because they choose to. Suburbs have cheap space and better schools, both qualities that are especially valuable to families with kids. Further, I know lots of professional people who live in cities, and most of them still drive to work unless they work downtown. The real cost of people living in sprawling suburbs lies in environmental degradation, pollution and congestion. These costs can be better reduced directly by raising gas taxes and selectively adding highway tolls.

What do you think of Brown's free RIPTA bus passes for employees and students? Should other large employers do this?

From my perspective, I appreciate the few dollars it saves me. But most employers wouldn’t find it in their interest to offer such an incentive unless they could internalize the cost of the transit provision as Google does with its free bus system for employees. The buses are very nice with comfy seats and wifi; employees can work on the bus and Google can save on the number of parking spaces it provides.

The costs that people impose on society by driving affect everyone, not just people at one company, so solutions are going to be more effective coming from government. I don't think that government should have goals for commuting mode choice for people.  Instead, the goal of the government should be to make people pay the full costs they are imposing on society by driving or choosing mass transit. That is why I advocate a higher gas tax that would have as a consequence some people switching to transit on their own.