APPLIED MICRO: Optimal Public Transportation Networks: Evidence from the World’s Largest Bus Rapid Transit System in Jakarta; Professor Benjamin Olken (Massachusetts Institute of Technology)

Abstract

Designing public transport networks involves trade-offs between coverage, service frequency, and direct service. We use the expansion of the bus system in Jakarta,Indonesia, to study these trade-offs. We analyze how new direct connections, changes in bus travel time, and wait time reductions affect bus ridership and aggregate flows,and estimate a transit network demand model by matching the route launch events.Commuters in Jakarta are 2-3 times more sensitive to wait time than bus time, and inattentive to long routes. We develop a flexible framework to characterize optimal networks. A less concentrated network would increase ridership and commuter welfare.

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