Urban transportation infrastructure and poverty reduction: Delhi Metro’s impact on the cycle rickshaw rental market

This paper, on the basis of a primary survey of cycle rickshaw pullers and rickshaw owners in Delhi, India, estimate the causal impact of the opening and extension of Delhi Metro on the rental rates of cycle rickshaws. The cycle rickshaw rental market provides employment opportunities for unskilled, assetless workers who have migrated from rural areas because of poverty. A change in this market is thus expected to affect both urban and rural poverty. Controlling for unobservable area characteristics using house tax information, identify the causal impact depending on when Metro stations opened over the past decade. The regression results indicate that of the 1.6 percentage point increase in rental rates per km associated with a reduction in distance to a Metro station, approximately 0.3 point could be attributable to the causal effect. Thus, Delhi Metro has increased the demand for cycle rickshaw services, which could be termed as a pro-poor consequence of the infrastructural investment.