Is the Mexico City metro an inferior good?
Time series cointegration techniques are used to estimate whether the Mexico City metro is perceived as a normal or inferior good. Owing to the fact that the Mexico City metro mainly serves the low income sectors of the population, this paper attempts to separate the overall income effect into two uncorrelated components: a vehicle stock effect (used as a proxy for medium/high income) and minimum wage effect net of the influence of vehicle stock (used as a proxy for low income). The time series cointegration results show that minimum wage elasticities are positive whilst vehicle stock elasticities are negative. These results suggest that for the majority of metro users, whose salaries are based on low multiples of the minimum wage and are not potential car owners, the Mexico City metro is perceived as a normal good. However, for middle/high income earners, who can afford to buy a private vehicle when their incomes increase, the Mexico City metro is perceived as an inferior good.
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Availability:
- Find a library where document is available. Order URL: http://worldcat.org/oclc/29485010
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Supplemental Notes:
- Abstract reprinted with permission from Elsevier
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Authors:
- Crotte, Amado
- Noland, Robert B
- Graham, Daniel J
- Publication Date: 2009-1
Language
- English
Media Info
- Media Type: Print
- Features: Figures; References; Tables;
- Pagination: pp 40-45
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Serial:
- Transport Policy
- Volume: 16
- Issue Number: 1
- Publisher: Elsevier
- ISSN: 0967-070X
- Serial URL: http://www.elsevier.com/locate/issn/096707X
Subject/Index Terms
- TRT Terms: Developing countries; Elasticity (Economics); Income; Rapid transit; Time series
- Geographic Terms: Mexico City (Mexico)
- Subject Areas: Economics; Passenger Transportation; Public Transportation; I10: Economics and Administration;
Filing Info
- Accession Number: 01128558
- Record Type: Publication
- Files: TRIS
- Created Date: May 19 2009 7:48AM