I’ve been asked from time to time, Alon, you write about comparative rail costs all the time, but what about roads? Sometimes the question expresses curiosity about whether roads display the same American construction cost premium as urban rail does; sometimes it expresses frustration that The Discourse doesn’t complain about road costs. Regardless of why people ask, I’d like to explain my reasoning in depth, especially now that serious people are asking why this is the focus of my comparative research.
There’s an easy answer and a hard answer. The easy answer is that I’m a railfan. I got into this because I was living in Morningside Heights and taking the subway to social events in Brooklyn and Queens, which involved 3- and sometimes 4-seat rides. It got me interested in coverage gaps and subway extensions, which got me interested in the construction costs of such extensions.
But that’s not really it. From my original purpose of comparing a few urban infill subways in large global cities I got into operating costs, and high-speed rail, and light rail, and electrification, and even road tunnels (here is my comparison of urban road tunnel projects). What’s more, other people have looked at comparative costs, and even without sharing my not-knowing-how-to-drive origin story, they don’t compare individual road projects much. The Brookings study about the Interstates looked at the entire cost of the US Interstate program rather than teasing it out project by project.
What’s really going on is that subways are megaprojects. Megaprojects are visible, and I don’t just mean physically – they’re widely discussed in the media and politics, and cost overruns invite intense criticism by the opposition and by investigative reporters. Everybody in New York knows about Second Avenue Subway, and everybody in New Jersey knows about the Gateway tunnel, and everybody in London knows about Crossrail.
The upshot is that megaproject cost estimates are just more reliable than those of anything else. What I mean is not that cost overruns are unlikely. Rather, what I mean is that cost overruns are difficult to hide, unless the agency goes the Canadian route of fluffing the budget with very high contingencies. The current budget for Grand Paris Express is around €35 billion, up from €25 billion when it was first announced. If it actually ends up at €36 billion and not €35 billion then it may be possible to scrounge extra funds from a few sources sub rosa, but not if it ends up at €45 billion.
The largest source of wasteful spending in the world is the American military. It has a budget of $700 billion a year, debated largely behind the scenes, with boisterous generals and their lackeys ready to publicly defend every $600 toilet seat and every procurement item in the district of any member of Congress who dares object. There is a shroud of secrecy around everything that can be justified as national security. There is no exit threat – the military can’t be shut down the way an underperforming state railroad can be privatized. Hidden costs are rampant, and as far as I understand, they are on the order of a few billion dollars at a time.
I bring up American military waste not to justify civilian waste on infrastructure, but to compare which costs can be plausibly hidden. If the US military can miss a few billion dollars, the transport planners of Ile-de-France can miss tens to hundreds of millions of euros on a 15-year, 200-kilometer project. Those of Madrid can probably miss an amount of money on the same order of magnitude as those of Paris. The low construction costs in Madrid have been plugged into additional construction, giving Madrid Europe’s third longest metro network after London and Moscow; those hundreds of kilometers built in the last 25 years could not have cost the same as in France, let alone the US, because this would have been too big of a difference, and the media would have noticed.
The same situation equally occurs for road megaprojects, such as tunnels or big urban reconstruction projects, such as the lane additions in Los Angeles. But it does not occur for run-of-the-mill road widening outside urban areas or for small projects to increase the capacity of a junction from a cloverleaf to a four-level interchange. These are not sufficiently visible for me to be able to trust that there is full cost accounting in the trade and popular press.
I’m happy to compare the costs of road tunnels between different cities; the few examples I have found paint the same picture as the subway cost comparison. But above-ground road construction is harder, just because “above-ground” can mean anything from a complex viaduct-over-viaduct to simple at-grade construction. Even then, ancillary costs like unnecessary street reconstruction may be bundled into the overall budget, and since above-ground construction isn’t so expensive, these extras may be a sizable fraction of the cost.
For a similar reason, I don’t look at airports so much: they’re just harder to compare. I do not know how big the Berlin-Brandenburg disaster is compared with other airports under construction, so I do not know how much it should cost; I don’t even know what the equivalent metric of cost per km or cost per new station excavated is. In contrast, to take another well-known German infrastructure disaster, Stuttgart21 has a definite tunnel length – 30 kilometers, as well as another 25 above ground – so I can compare with other regional rail projects and say that actually the cost of Stuttgart21 (€6.5 billion) is not so high relative to how much urban mainline rail tunneling costs elsewhere in the world.
For the exact same reason, when I look at above-ground urban rail I try to separate out truly at-grade light rail from elevated lines. The only times I try to do a deep dive are when these projects encroach on the cost range of subways, like the Boston Green Line Extension. Elsewhere, ancillary costs can be substantial, as with the Nice tramway: 70% of the budget was the tramway itself and 30% was stormwater drainage, rebuilding a public plaza, tree planting, and other extras. Extras introduce an error term into comparisons that are harder to ignore when the cost is $50 million per kilometer than when it is $300 million per kilometer.
Road costs remain a powerful sanity check. All of the reasons I (and others) believe are behind the American construction cost premium are equally applicable to roads and urban rail. So far, looking at road tunnels confirms the subway pattern, but there just aren’t a lot of road tunnels built around the world – they’re expensive for the capacity they provide. And if it’s possible to carefully tease out above-ground road megaproject costs then a comparison is welcome as well. But they are unlikely to form the backbone of any comparison.
Metro tunnels, for all the handwringing about special circumstances, are pretty consistent. Some places have easier rock and some have harder rock, but usually this will be noted in the trade and popular press; the most fundamental quantities, length and the number of stations, are if anything easier to find than the headline costs; ancillary extra costs are usually not significant, and when they are, they tend to be bundled into quantifiable metrics like station size and depth. The only big difference in reporting regimes is that some places (like Spain) bundle together infrastructure and rolling stock costs whereas most don’t.
The main approach to project-level comparison of infrastructure costs across countries has to be about urban rail, because that’s by far what’s most common across the world. The error bars around ex post costs are small enough that even a relatively restricted sample is suggestive of the real global effect as I’m learning when adding more and more projects to my database (currently about 130 projects totaling 2,000 km). This is the most comparable list of public infrastructure projects, and what we may learn about why various American urban rail lines cost so much and why Spanish and Korean and Nordic ones cost so little is likely to generalize.