Transportation and Suburbanization : How Did the Old Tramway Shape Shanghai, China

This article studies the short- and long-run economic consequences of the now-extinct Shanghai tramway system. Geo-locating the tramway lines on both historical cadastral maps and current Google maps, I sort land parcels in the 1900s–1910s, and residential complexes in 2018, into treatment and control groups, based on their proximities to the tramway that opened for public transit in 1908. Utilizing historical data, a triple difference estimation indicates that the tramway system increased land values more in suburban than urban area, fostering suburbanization by making the suburbs more accessible; estimations based on modern data find a limited tramway effect on the nearby housing prices outside the area of earlier development. As the former suburbs evolved into part of the central city, the influence of the obsolete public transportation faded away along with the accessibility it once brought. Premium only remains where subsequent investments near the tramway lines are durable and great enough