Rapid Transit, Labor Market, and Business Growth: The case of São Paulo, Brazil
Resumo: The São Paulo Metropolitan Region underwent a series of rapid transit investments since the mid-2000s that increased the region’s rail network by around 20 percent. We examine the impact of this expansion on wages, employment, and the emergence of new firms using unique geolocated employer-employee data from an annual administrative survey conducted by the Brazilian Ministry of Labor from 2006 to 2017. To account for spatial differences, we estimate the impact separately for each transit line, whereas our staggered difference-in-differences approach assesses treatment timing heterogeneities. Our results indicate an 11.3 percent increase in employment and a 9 percent rise in new firms, with no significant change in wages. The average number of workers per firm remained constant, suggesting that employment gains stemmed from new companies rather than the expansion of existing ones. The effects varied between transit lines with the most substantial impacts observed for Line 9, in one of the less developed regions of São Paulo. Beyond providing unique empirical evidence for São Paulo, this study contributes a framework for applying the novel staggered Difference-in-Differences (DiD) method in the context of transit policy, emphasizing spatial characteristics.
Real estate and rapid transit: estimating the market premium of the São Paulo Rail Network
