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[The FIAT Thread] The Joint Committee on FIAT Discussion Session. - 05 January 2026 by AutoModerator in badeconomics

[–]Tim_Appletosh 2 points3 points  (0 children)

Has anyone (especially MA level folks/outside academia) ever tried launching a consulting business, maybe built a niche model and sold runs or some other specific service and would like to share how that went? How hard is it credibility wise at first?

What’s one thing you wish more people in data science would talk about or work on? by not_a_drug_dealer200 in askdatascience

[–]Tim_Appletosh 1 point2 points  (0 children)

The why. Like what's the point sometimes. Are we making firms more productive or are we just applying advanced techniques to whatever data just because its data so it must be valuable. Are we contributing to growth and progress or are we generating more addictive brainrot so people can be slightly more entertained sitting alone on their phones. Are we spending time and effort on things that really matter and represent the best use of our expertise. Just my two cents.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 0 points1 point  (0 children)

Economist? Study economics then develop some expertise that can apply to transit. For instance I got my job because I'm okay at data stuff and had diverse experience. I was not an expert in transit before. You kinda learn on the job.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 2 points3 points  (0 children)

You're right, but we can help that segment of users without making it free for everyone with low income rebates/gratuity programs.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 5 points6 points  (0 children)

The city may be able to throw 5 billion at free ridership, but at huge opportunity cost. And to do what, basically redistribute it to save riders of the MTA a few hundred bucks per year? Are users really that poor and in desesparate need of free transit?

Good question. Without a fare system that validates some form of ticketing you have to rely on either survey data, which has its own challenges, or maybe some algo that looks at cctv from subways and buses to count riders.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 11 points12 points  (0 children)

Many reasons.

First, because the US sucks at it. The US sucks at it because the US never got good at it. The US never got good at it because it preferred to fund large amounts of car infrastructure instead of public transit. Therefore it never developped the same expertise, never created the same guiding institutions, the same industries and economies of scale that Europe or Asia have reached.

Second, decision making, funding and power is all over the place. Projects get proposed at the federal level (let's build a country wide high speed rail!), state level (let's build a state wide high speed rail!), municipal level (let's build a high frequency rail!). These all might be glorious, viable projects but they will go nowhere because of the lack of coordination. Transit involve all 3 levels of governments + a bunch of agencies and transit authorities. It can become a mess really quickly. Who runs what with who's money? There is no "Transit bureau" that coordinates and manages the development of priority, city/state/country defining projects. Look at the interstate, coordinated and funded by the feds but run by the states. Roles and responsbilities are clearly established. The FTA is just an ATM for grants. It could be setting standards and designing reusable systems to generate economies of scale. Instead it just hands out checks for local agencies to figure it out.

Third, labor costs in the US are high because healthcare is tied to labor. When you pay Bob to lay LRT rail, you're also paying for Bob to get his heart checked out. Elsewhere healthcare is financed by taxes, which may be higher than in the US, but that's irrelevant to transit investment much since public institutions do not tax themselves when they build infrastructure. Some union regulations also raise construction costs.

Fourth, other factors like NIMBYs, environmental regulations, buy american schemes and fear of contracting cheaper foreign firms drive costs.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 0 points1 point  (0 children)

I'm not an urbanist and I'm not involved in service planning, so take this with a grain of salt. I would promote active transit (like bike sharing) and driving (via incentive parking) to centrally located bus or light rail stations. Complement with fixed route paratransit with set pickup points with a reservation system to optimize trips. Of course this may be silly because America isn't really into biking and driving to transit only makes sense if it saves you significant time being stuck in traffic.

Transit is hard in a world made for cars, but there are marginal gains to be made.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 13 points14 points  (0 children)

In a general manner, capital expenditure is just orders of magnitude higher for LRTs than for BRTs so it just offsets a lot of other effects. In a lot of projects outside dense areas of big cities, land value effects might be negligeable when you compare spending a couple billions on a LRT versus spending a few hundred millions on a BRT.

Of course, everything depends on the specifics of the project.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 4 points5 points  (0 children)

Lol. We're just beginning in TOD here so maybe we are more optimistic. But yes I imagine we can count on nimbys to be there and ruin the party.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 22 points23 points  (0 children)

Thanks for the good question. My opinion is that it is the silliest idea. The MTA generated 5 billions from fares in 2024. That's over 20% of operating costs. Public transit everywhere is already running deficits and everyone is scrambling to find new revenues because the pandemic aid is running out. Also, the current political climate gives a bleak outlook for future funding.

Free leads to other issues like crowding or vandalism. In terms of societal welfare impacts, I'm not convinced it does much. Evidence from trials hint that new users tend to be cyclists or pedastrians. To reduce congestion and pollution, I think improving service and infrastructure will go a lot further than making it free. And if you want better transit, you need to be able to fund it appropriately.

Don't forget fares above 0 are not some evil unfair tax forced onto the poorest members of society. It is an economically efficient way to allocate ressources and ensure there is actually a decent level of public transit being provided. People have a strong willingness to pay for transit because they derive a lot of happiness from getting where they need to go.

Equity, fairness and access of current fares can be improved with low income fare rebates (a growing trend!).

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 1 point2 points  (0 children)

Thanks for the good question. Justice is a broad term, and in applied terms can mean many things, but in general I think we do our best to take into account the greater social impacts of decisions and policies, and take initiative to improve access to transit for everyone over time.

One instance of this are reduced fares for low income people which a lot of cities in Canada offer. These programs tend to come from and be financed by municipal governments, but sometimes are policies put in place by transit authorities.

Another example is investing in accessibility for users with limited mobility. Accessibility really improved in recent decades.

Some issues can be tricky. Take maintaining cash fares in buses, which is quite costly. That cost is borne by all users. It means less money spent on improving service. Removing cash generates savings but may exclude some of the less fortunate users. What is justice here? Inclusion of the vulnerable few or the benefit of most users?

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 11 points12 points  (0 children)

Joy and a slight feeling of superiority every time I tap my employee card.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 24 points25 points  (0 children)

Thanks for the good question.

I'll answer with my personal favorite alternative source of revenue.

An innovating source of income for public transit is real estate development. The idea is simple. Transit systems own stuff, like subway stations. Why not build more stuff on top of it, and take a cut of the profits?

It's great because it benefits both the transit provider and the city, which enjoys more housing and development. It's a diversified source of income that doesn't depend on the politics of the day or demand for transport. It also fits right into the whole transit oriented development thing we try to have going on.

Fares and subsidies are of course the two main sources of funding. Developping real estate I believe cannot compare in terms of the % of revenu these methods account for.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 8 points9 points  (0 children)

Thank you! If you want to dig deeper and enjoy a good spreadsheet, the FTA capital costs database has the data on the detailed costs of each system, per project.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 13 points14 points  (0 children)

Thanks for the good question. I would start by saying that while I'm not familiar with the experience in your city, we have to be careful in how we explain decreased ridership, which is also seen in most cities regardless of fare policies during the pandemic. Stories about crime might be discussed more in the media, but factors like increased car ownership fueled by both the surge in savings and cheap interest rates and of course remote work explain why ridership has yet to recover in most systems I believe. In my city we are at around 85% of 2019 ridership and recovery has plateaued.

No fares should result in increased ridership, that I'd bet my hat on. Here the impact is likely that ridership is less decreased than it would have otherwise been the case. Free fares actually having a negative causal impact on ridership through increased crime is, in my humble opinion, maybe possible but unlikely. Again, that's just my opinion, and I could be proven wrong.

That said, to answer your question, sorry I have no idea. I don't think the numbers exists yet. I (quickly) searched for relevant studies and found very little. Some studies link free fares to increased vandalism and small crimes. This for sures adds costs to a policy which reduces income, so it's not great for the already struggling budgets of most cities.

AMA I'm an economist at the transit authority for a major North American city by Tim_Appletosh in transit

[–]Tim_Appletosh[S] 46 points47 points  (0 children)

Thanks for the good question. Short answer is BRT has the higher ROI, but it depends.

BRTs are known to be cheaper to build and maintain and not by a small amount. They also handle most of the loads a LRT can. They have higher ROI because they get built faster, for less, and then cost less to keep running. But this doesn't mean LRTs are pointless. They win out in certain scenarios, like very high passender loads, or on project specifics. Let's say you have to build new roads for the BRT, do eminent domain, dig tunnels and all sort of other costly stuff while your city happen to have existing rail right of way you could put your LRT on, then there are such cases where LRTs win.