Car Ownership? Evidence from the Copenhagen Metropolitan Area

1. Introduction
Public transport is, potentially, an important substitute for the car and recent research suggests
that its presence may have an important impact on urban congestion (Anderson, 2014). Good
public transport may make car ownership less attractive. If parking spaces are difficult to find, or
if parking is expensive, as is the case in many city centers the benefits of owning a car may still
be lower (Van Ommeren et al., 2011). Moreover, the availability of many amenities at walking
distance in residential areas decreases the value of owning a car even further. It is therefore no
surprise that the share of car-owners is lower in urban than in rural areas (see, for instance,
Dargay (2002) and Pyddoke and Creutzer (2014)).
In this paper we study car ownership in relation to the availability of public
transport. We look at the choice of car ownership and the residential location as a simultaneous
decision, taking into account that households may want to live in a particular location especially
because of the availability of public transport. The interaction between car ownership and public
transport has been addressed in an older literature (see for instance Goodwin (1993)), but appears
to have been neglected in recent decades. It is, nevertheless, of considerable interest because
road congestion is still an important problem in many urban areas, pollution by cars is associated
with health problems and global warming is perhaps the most important environmental problem
of our age. Cities can be relatively green places (see e.g. Kahn (2006)) and the lower share of car
owners contributes to that.
Despite the – at least potential – importance of the relationship between cities and
car ownership, the topic has received little attention in economics. There is an older literature in
economics looking at car ownership (see, for instance, Mannering and Winston (1985)) that pays
marginal attention to it. For instance De Jong (1998) develops a binomial model in which car
ownership and use are modelled simultaneously and reports that living in a rural area increases
the probability of owning a car.
There exists a small geographic literature on the impact of urban form and urban
amenities on car ownership. See for instance Dieleman et al. (2002) or Potoglou and Kanaroglou
(2006). In this literature car ownership is usually estimated as a binomial choice, conditional on
the characteristics of the residential area. For instance, Potoglou and Kanaroglou (2006) find that
mixed land use is associated with a lower share of car owners. It is perhaps more surprising that
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