Carbon pricing and transit accessibility to jobs

Urban transport is a major driver of global CO₂ emissions which many economists call for to be mitigated through carbon pricing. However, carbon pricing policies are frequently criticized and resisted for having adverse distributional impacts, often despite a lack of quantified evidence. We examine the impact of a fuel levy on access to employment opportunities via transit in Kinshasa and Rio de Janeiro based on travel time and budget. The results indicate that fuel price increases reduce accessibility with clear socio-spatial heterogeneity. Mid- to high- income households are the most affected in terms of accessibility losses. But even small absolute losses can exclude the poorest from accessing a “reasonable” pool of jobs. The results also show that impacts vary more within income groups than across: locational decisions are key determinants of the outcome alongside income. Transit decarbonization and land use policies can help mitigate the negative impacts of carbon pricing.