Bike lanes’ economic benefits go beyond jobs

Cycling infrastructure gets people on their bikes, and the economic benefits are legion. Janet Lackey

You might have heard that bike lanes are a waste of money. The Australian National Audit Office recently investigated the $40 million bike path scheme, announced in 2009 as part of the Federal Government’s stimulus package, and found the scheme “fell significantly short” of hitting its aims.

The Australian newspaper article “More stimulus questions as cycle of waste rolls on” took up the story, describing the auditor’s “major concerns”.

According to the Australian, the Australian National Audit Office said the construction of the bike paths didn’t create as large a number of jobs as the scheme had envisaged.

What this perspective fails to grasp, however, is that the economic benefits of bike paths are not simply limited to jobs created during path construction. Long after the bike path concrete has dried the economic benefits can keep rolling, so long as the bike path is well planned and integrated into a broader cycle network.

The ongoing benefits of bike infrastructure were illustrated in a recent media report which showed that new Sydney cycleways have had a positive effect on property prices. This account indicated that having a bike path right outside your front door increases the value of your house. One owner in the area said that the combination of a garage at the rear and the bike path out the front had added a premium of $100,000 to his house.

The rise in real estate prices from bike lanes is not limited to Australia. Across the other side of the world, a study in Pittsburgh found that bike paths led to increases in business and property selling prices. Realtors in North Carolina reportedly added US$5,000 to the prices of 40 homes adjacent to the Shepherd’s Vineyard Bikeway. Similarly results from the City of Vancouver indicated that 65% of realtors would use the bikeway as a selling feature of a home. The University of Delaware study showed that on average properties within 50m of a bike path could be expected to increase property values by at least US$8,800.

Going beyond house prices, a study done for the City of Sydney shows the city’s planned 200 km cycleway network would deliver $506 million in net economic benefits over 30 years. This is roughly equivalent to a $4 return on every dollar spent, compared with just $2 for motorway projects.

Evidence of the broader economic benefits of bike lanes is not limited to Australia. In Copenhagen the bicycle, with a modal share of 36%, is already the most used form of transport for trips to work or educational institutions. A study commissioned by Copenhagen’s mayor showed that driving cars offers up a $0.20 net loss for each mile driven, due to congestion, health, accidents and environmental impacts. This is in contrast to the bicycle which offers a $0.35 net benefit to the economy per mile ridden.

In a similar manner in Portland, Oregon, increased cycling as result of sustained bike lane investment is generating more than $100 million of economic activity each year and creating 1000 jobs.

The success of raising cycling rates in Copenhagen and Portland illustrates the benefits of strong and sustained investment in a network of bike lanes. As these integrated networks expand and connect the places people want to go to and from, this creates greater use, better network efficiencies and better returns on investment.

Or as Greg Ip puts it: “Just as you are more likely to buy an iPad the more applications it has, you are more likely to switch from car to bicycle the more bicycle lanes (and therefore destinations reachable by bicycle) are available. Doubling the number of bike lanes more than doubles the number of cyclists likely to use them.”

And of course there are the positive long-term economic benefits of bike infrastructure such as the savings to the health system, and the impact a greater percentage of people cycling has on lowering the cost of road infrastructure.

Cycling infrastructure is a low cost urban transport option that has the potential to have greater overall economic, environmental and social benefits, compared to mainstream urban transport investment. But it is also clear that much of the evidence available is anecdotal and somewhat thin.

If cycling is to be a central part of our cities more research and data is needed to better illustrate the correlation between a healthy investment in a city’s cycling infrastructure and a healthy city economy.

Not only does better bike infrastructure help create a more liveable and sustainable cities, but the early evidence is that it improves local economies as well. The next step is for cities to both step up this level of investment and back it up with high quality research along the way.