Transportation finance equity: A theoretical and empirical review of pricing equity, expenditure equity, and pricing-expenditure equity in US transit provision

Abstract

Research concerning transit pricing and expenditure equity overwhelmingly emphasizes pricing disparities or expenditure disparities without consideration of the other. Findings broadly indicate that transit investments and fare policies in the United States disproportionately burden marginalized populations or disproportionately benefit socioeconomically advantaged populations. However, disparities in what different populations pay relative to the costs of services they receive—that is, the economic subsidies they receive—are surprisingly underexplored in the literature. Yet, this analysis is essential for evaluating whether government subsidies are being used effectively, efficiently, and equitably. In addition, by overlooking how costs and benefits vary across locations and times of travel, the literature often treats the amount people travel as fully reflective of both the benefits they receive and the costs they impose. Finally, the diversity of transit modes represented in the literature is imbalanced. Rail transit is disproportionately represented in capital-focused research, while bus transit is disproportionately represented in operations-focused research. The literature could benefit from a broader application of transit modes, more spatially and temporally granular cost allocation models, and the use of cost recovery (or subsidy) disparity as a measurement of equity.