Transitway Development and Commercial Gentrification

Principal Investigator(s):

Yingling Fan, Professor, Humphrey School of Public Affairs


  • Noah Wexler, Research Assistant, Humphrey School of Public Affairs

Project summary:

Although public transitway investment typically benefits regional economies in aggregate, affordable housing advocates and small business communities have concerned about transit-induced gentrification along affected corridors. Upswings in land value along new transit corridors may burden low-income residents and small businesses through increasing residential and retail rental payments. In theoretical terms, transit increases the rent gap - the difference between a land parcel's current rent value and its possible rent value. Thus, there is more incentive for developers to fill the rent gap by retooling existing land for more efficient rent extraction. Given the increasingly entrepreneurial nature of urban governance, it is important to investigate which specific policies have negative - and often unintended - consequences on vulnerable communities. This study proposes to investigate the effects of transitway development between 2000 and 2019 on businesses along transit corridors in the Twin Cities metropolitan region. Specifically we will analyze indicators for commercial gentrification along the following "treated" corridors include the Blue Line Light Rail Transit/Hiawatha (LRT) corridor (opened in 2004), the Green Line LRT corridor (opened in 2014) and the A Line Bus Rapid Transit (BRT) corridor (opened in 2016). We will examine the effect of transitway development several indicators for commercial gentrification using difference-in-differences models. Additionally, we will identify "at-risk" corridors for transit-induced commercial gentrification along planned corridors in the region.

Project details: