Do Rail Transit Stations Encourage Neighborhood Retail Activity?

Do Rail Transit Stations

Encourage Neighborhood Retail Activity?

Presentation by Jenny Schuetz Board of Governors of the Federal Reserve System

Wednesday, October 8
12:00 PM to 1:00 PM


Preinkert Field House – Conference Room 1112V
University of Maryland College Park


Over the past 20 years, California has made substantial investments in intra-metropolitan passenger rail infrastructure, expanding existing systems and building new ones. According to advocates of New Urbanism, such investment should encourage the growth of mixed-use transit-oriented development, defined as a high-density mix of residential and commercial uses within walking distance of rail stations. Little research to date has examined whether rail investment stimulates retail activity, which is a key component of mixed-use development. In this paper, I test whether the opening of new rail stations across California’s four largest metropolitan areas is associated with changes in retail employment near the stations. Results indicate that new rail stations were located in areas with previously high employment density, somewhat outside the city centers. New station openings are not significantly associated with differences in retail employment in three of the four MSAs, and negatively associated with retail in the Sacramento MSA. There is weak evidence that areas around new suburban stations serving commuter rail lines are more likely to gain retail employment, while centrally located, intra-city rail stations see decreases in retail activity.

JENNY SCHUETZ is an Economist in the Consumer and Community Affairs Division of the Board of Governors of the Federal Reserve System. Her main research interests are urban economics, real estate and housing policy. She has written numerous journal articles related to land use regulation, urban retail patterns, and neighborhood change. Her research has been cited by media outlets including The Economist, the New York Times, National Public Radio and Slate. Prior to joining the Board, Jenny was an Assistant Professor at the University of Southern California’s Price School of Public Policy, where she taught courses in real estate finance and policy analysis. She worked previously for New York University’s Furman Center for Real Estate and Urban Policy, the Fannie Mae Foundation and Abt Associates Inc. Jenny received a PhD in Public Policy from Harvard University, a Master’s in City Planning from M.I.T., and a B.A. with Highest Distinction in Economics and Political and Social Thought from the University of Virginia.