Mobility, segregation and inequality: Who gains from urban transportation improvements?

Urban transportation projects are massive public investments that can transform cities. This article reviews how they shape where people live and how they affect the rich and poor differently. Existing empirical evidence and a simple model point to three factors that matter most: who uses the new mode, where it is built, and how easily people can relocate. Projects serving a narrow group in a specific area tend to raise income segregation and inequality. These effects can be severe if poorer households face barriers to relocation, as with the Interstate Highway System. Projects with broad ridership and broad spatial coverage, like Bus Rapid Transit in developing countries, have smaller segregation effects and more widely shared welfare gains.