An analysis of household transportation spending during the 2007-2009 US economic recession

Thakuriah, P. and Mallon-Keita, Y. (2014) An analysis of household transportation spending during the 2007-2009 US economic recession. In: Transportation Research Board 93rd Annual Meeting, Washington D.C., USA, 12-16 Jan 2014,

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Abstract

The recent economic recession in the United States led to widespread destruction of jobs, home foreclosures, credit freeze and to creditor repossessions of key assets such as personal cars. Our objective is to empirically assess transportation conditions of US households with a focus on transportation spending. The latter is examined in the context of changes in multiple metrics such as total number of household cars, zero-vehicle status, expenditures on local public transportation and gasoline, down payment and net purchase price of cars, decline in household vehicle stock, and interest rates on auto loans. Using an econometric model of repeated cross-sections of data on households from the Consumer Expenditure Survey for the period 2005 through 2009, we examine factors which affect recession-period spending. In an effort to demonstrate the effects of the recession on specific groups, as well as to examine equity implications for vulnerable populations, our overall results are disaggregated by variations in transportation spending of minority, single mother and young households. Transportation spending declined significantly between 2005 and the recession years. A large part of this was due to lower car-ownership levels and an overall increase in zero-car households. Those households that did acquire a car needed to make higher levels of down payment. They also paid higher interest rates compared to the pre-recession period. Minorities spent significantly less than non-minorities before the recession but the difference from non-minorities was not significant during the recession. Single mothers did not spend significantly less than other households overall; however, their spending level became significantly less during the recession and they were much more likely to become zero-car households during the recession. The cost of car-ownership increased drastically for young adult households and the share of carless young households greatly increased during the recession.

Item Type:Conference Proceedings
Additional Information:Transportation Research Board Annual Meeting 2014 Paper #14-5254. This paper was peer-reviewed by TRB and presented at the Transportation Research Board 93rd Annual Meeting, Washington DC 12-16 Jan 2014.
Keywords:transportation spending, recession, car-ownership, vehicle interest rate, minority, single-mother, young adults, equity
Status:Published
Refereed:Yes
Glasgow Author(s) Enlighten ID:Thakuriah, Professor Vonu
Authors: Thakuriah, P., and Mallon-Keita, Y.
College/School:College of Social Sciences > School of Social and Political Sciences
Journal Name:Proceedings of the Transportation Research Board
Publisher:Transportation Research Board, National Academy of Sciences
ISSN (Online):1073-1652
Copyright Holders:Copyright © 2014 The Authors
Publisher Policy:Reproduced with the permission of the authors.

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