Cycling Economics

Cycling is increasingly receiving attention in research and policy and practice, in many cities and regions in the world. The focus is mainly on cycling infrastructure and effects on travel behavior and health. The economics of cycling have not received a lot of attention yet. This chapter gives an overview of the current state of knowledge about cycling economics. It shows that at first face the economics is straightforward, and is about the same as those of other transport (infrastructure) projects, but in practice there are several pitfalls which can easily result in flawed estimates of the costs and more so the benefits of cycling projects. The first problem is the lack of adequate models to estimate travel behavior related cycling effects, even in countries with a cycling tradition, like Denmark and the Netherlands. An important pitfall is that if the so-called safety-in-numbers effect is ignored (cycling becomes safer if cycling levels increase), risks and related costs will be overestimated. Another pitfall related to cycling is the use of national (or regional) aggregate risk factors—these do not necessarily apply to specific cases. In addition there is still a lot of uncertainty about the size (and monetary valuation) of health effects. And finally several effects categories are poorly understood and often ignored, in particular the option value, the impact on the attractiveness of the urban environment, and the impact of cycling on (the reduction of) social exclusion. These problems may not all be too important, because cycling projects are cheap, and often have a high benefit-cost ratio.