M-RCBG Associate Working Paper No. 143

Riding With Charlie: Public Transportation Policy and Its Impact on Business and Road Safety in Massachusetts

Honorable Mention, 2020 Dunlop Thesis Prize

Pedro Farias



Can public transportation help local businesses and save lives and costs? This paper considers the impact of the MBTA's late night service extension on local businesses and car crashes and provides two main contributions. The first is evidence from a differences-in-differences design that businesses may benefit from late night service, as the number of Yelp reviews for businesses near stops with late night service increased between 2.5% and 8% and the number of late night tweets in areas with the service increased 4%, with these estimates statistically significant at the 99% level. The second is that the service helps reduce the number of car crashes by 4% on average, though this is not statistically significant. Areas with a high proportion of young individuals and minorities experienced a stronger treatment effect of around 12%, with statistical significance varying based on each of the three empirical
strategies employed, which include differences-in-differences, propensity score matching, and geographic proximity analysis. This indicates public transportation could be effective both to boost the performance of local businesses and save lives by reducing the incidence of car crashes.

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