Description:

Northwestern University Transportation Center presents:

"The Marginal Congestion of a Taxi in New York City"

Alejandro Molnar
Assistant Professor, Department of Economics, Vanderbilt University

ABSTRACT:

We exploit the introduction of a new class of restricted taxi medallion in New York City to provide a causal estimate of the impact on congestion from the addition of taxis to the city. In August 2013 the City of New York introduced a restricted class of “boro” (or “green”) taxis. Boro taxis provide an equivalent service to that of “yellow” medallion taxis, but are restricted from pickups in Manhattan south of a boundary along East 96th St and West 110th St. We document a large spike in taxi cab activity north of the restriction boundary, driven entirely by entry from boro taxis and partially offset by retrenchment from traditional yellow medallion taxis, which face additional, localized competition. This variation allows us to study the effect of taxi supply on congestion: we construct a database of historical street-
level speed from taxi trip records by isolating the trips that consist of uptown or downtown “runs” along a North-South avenue, and projecting travel time onto street intervals. We find that the roll-out of the boro taxi program caused a localized 8% decrease in traffic speed. We then relate speed changes to taxi supply, by employing satellite and aerial orthoimagery to construct a novel data set of the location of taxis over time and space. We derive an empirical congestion curve between car speed and taxi activity.

[In progress: Additionally, we document a substantial slowdown in traffic speed throughout NYC since 2013, and are applying our estimate to attribute the share of this slowdown that can be explained by app-based rideshare providers.]

SPEAKER BIO:

Alejandro Molnar is an Assistant Professor of Economics at Vanderbilt University. His research focuses on market structure, competition and regulation in transportation and ecommerce industries. His dissertation research was on airline incentives in scheduling and a resulting "tragedy of the commons" outcome in the allocation of runway capacity at US airports. He received his PhD in Economics from Stanford University, and undergraduate degree from the Universidad de Buenos Aires.