Saturday, January 9, 2016

How (much) can population aging affect transit fares in Sao Paulo?

warning of belated self-promotion: This is a paper I published with colleagues last year in the Brazilian Journal of Population studies. The study  was published in Portuguese only, but the abstract should give a good summary of what we have done.

Pereira, R. , et al. (2015). The effects of population aging and fare concessions on public transport fares in São Paulo Metropolitan Area. Revista Brasileira de Estudos de População, 32(1), 101–120.

Abstract: Students, children under 4 years old and people aged 65 and over are entitled to partial or full concessions on urban trips in public transport systems in Brazil. These concessions are not covered by public funding, but rather through cross-subsidies from other passengers who pay full fare. In this study, we estimate the effect population aging will have on public transport fares over the next four decades in the metropolitan area of São Paulo (MRSP), the largest metropolitan area in Brazil. The analyses in this paper are based on data from a Household Travel Survey carried out in 2007, and on official population projections developed by IBGE (Brazilian Institute of Geography and Statistics) and Seade Foundation for the years 2020, 2030 and 2050. Considering the different periods of population projection, we adapt the technique of direct standardization to simulate expected changes in the composition of public transport trips in terms of paying and non-paying passengers. The results indicate that, in the short term (2020), the population aging expected to occur in São Paulo should have a modest effect on the total number and age composition of trips in the public transport system in the region. In the medium and long terms, however, the expected growth in the proportion of non-paying passengers could result in an increase in fare prices by about 10% and 20% if the current cross-subsidization mechanism is maintained.

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