How private transit responds to public transit: Evidence from Lagos
This brief analyses the impact of Lagos’s Bus Reform Initiative, which introduced public buses to compete with the city’s informal minibus sector. The study finds that while commuters benefited from lower fares and improved service, minibus drivers faced significant income losses, underscoring the need to consider informal sector responses in public transit planning.
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Björkegren-et-al-Policy-Brief-August-2025.pdf
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This brief explores findings from a study of a new public bus system in Lagos, Nigeria, and how the city’s existing private minibus sector responded to increased competition.
- The Lagos State Government launched the Bus Reform Initiative (BRI) in 2019, adding 820 modern buses on 64 routes by 2022 to provide a public alternative to minibuses.
- Private minibus operators reduced frequencies and fares on affected routes in response to public entry. Prices also fell on connected routes not directly served by public buses, showing that the effects spread across the network.
- Commuters gained an estimated USD 1.47 million per month from the reform, around 10% of which came from the competitive response of private operators.
- By contrast, minibus drivers lost about USD 0.75 million per month—roughly half the gains to commuters—which helps explain their resistance to reform.
- The findings highlight the importance of accounting for private responses when evaluating public transit investments, since informal operators are often invisible in official data.