Causal effects of transit investment on neighborhoods: Evidence from unbuilt alternative alignments

Source abstract

Light rail transit (LRT) projects have been associated with neighborhood change, attracting new residents and modifying the neighborhood’s affordability. However, evidence on their actual impacts remains mixed in part due to evolving methods for causal evaluation. Disentangling LRT’s effects from pre-existing trends is difficult, as station locations are rarely exogenous. To address this issue, this study deploys a novel quasi-experimental approach that leverages unbuilt station alternatives identified in federal environmental planning documents as counterfactuals. Rather than limiting our scope to an individual case study, we apply this study design to 15 LRT extensions in 11 U.S. cities since 2000, using station catchments to explore a suite of outcomes related to neighborhood composition. We identify two consistent patterns. Demographically, new LRT stations increase the proportion of residents who are middle-aged or older workers in lower-skilled sectors. However, the area’s older adult population (65+) slightly declines. Second, housing markets respond during the construction phase, with modest appreciation that dissipates by the time the lines open. These findings suggest that LRT investments diversify working-class geographies, while potentially disrupting aging in place, although this effect is small. Alternative alignment counterfactuals require additional research to further develop this approach.