Search

While numerous studies have shown that rail transit investment increases property value close to stations, not much has been said on the transit-induced indirect changes in neighborhood amenities and their role in property market's response to transit investment. The rapid expansion of Beijing's subway system over the last decade provides a precious opportunity to research the transit—retail amenities—property value connection. This paper enhances our knowledge by studying how local consumer amenities react to urban rail transit development and subsequently reflect in consumers’ willingness to pay. Using multiyear subway construction history, station neighborhoods’ restaurant activities and rental housing transactions in Beijing, we find a new subway station positively contributes to the number of new openings and the diversity of nearby restaurants. The changes in neighborhood restaurant activities capture 20–40% of the home value appreciation following the construction of a subway station. Our findings support the “multiplier effect” of neighborhood retail amenities in rail transit's impact on local home value. The public investment in transit and the private market responses complement each other and together contribute toward urban quality of life, as revealed by the appreciation in local property values. [ABSTRACT FROM AUTHOR]

The housing affordability issue in mega-cities creates a significant job-housing mismatch and undermines productive new business creation. This paper focuses on Beijing and investigates whether improved accessibility via the subway network helps new firms benefit from agglomeration economies and, at the same time, provides workers with easy access the low-cost rental housing. Using commercial rental housing transaction records and dynamic bilateral subway travel time from 2010-2015, we build the measure of the accessibility to business clusters and low-cost rental housing through the subway network at a high spatial resolution. Taking advantage of exogenous shocks from the network reconfiguration due to the rapid subway expansion in Beijing, we employ a matched difference-in-differences estimation in multiple periods to identify the causal elasticity estimate of the new firm formation with respect to the accessibility to business clusters and low-cost rental housing. We demonstrate that the subway network is more conducive to firm establishments. The effects are more salient for firms in skill-intensive sectors. New skill-intensive firms increase by 0.44% given a 1% increase in the accessibility to business clusters. The elasticity of new skill-intensive firms with respect to the accessibility to low-cost rental housing is about 0.74. Our findings that transit-oriented development leads to a higher concentration of new skill-intensive businesses, pointing to the importance of an efficient public transit system capable of serving the dispersed workforce and improving the efficiency of firm location choice. [ABSTRACT FROM AUTHOR]