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Do Public Transport Subsidies really increase Mobillity??

by on March 2, 2012





Why is it that Americans travel more than the Dutch?

And why is it that they travel so much more by car?

Travel is a good (not a bad). We must question why Dutch (and other Europeans) are less willing to travel. There could be a multitude of separate answers to these two questions. We have too few data points, to make any statistical judgement. I would, however like to entertain one hypothesis.

Could low mobility be induced by a flawed transport policy which makes mobility more expensive in The Netherlands? The Netherlands subsidizes its trains 1.5bn a year (that is 2/3 of the ticket price). The train is only used for 8% of the journey. The use of the most popular form of transport (the car) is taxed at more than 40%. The United States chooses to subsidize its oil companies, which provide gasoline for the car which is used for nearly 90% the distance travelled.

It is a simple law in economics that increasing  price decreases the quantity consumed. In The Netherlands it could well be the case that the cost of travel, be it by public transport or car, is more costly and thus consumed less. Policy makers should be wary of bringing the people let alone the countries’ economy to a halt.

From → Extended Society

One Comment
  1. munrofelix permalink

    Good point, see also the recent FT article about the costs of transport in the UK.

    One thing though, we do not want to encourage more travel by car as long as this travel directly adds to the carbon level and fine dust concentration.

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