Living in Israel is costly, with traffic congestion contributing significantly to the high cost of living. A recent study presented at the Aharon Institute for Economic Policy conference revealed that road congestion adds 6% to the cost of living gap between Israel and Europe, on top of the existing 34% gap in the basket of consumer products.
The study highlights the impact of housing costs and road congestion on the cost of living disparity. High housing costs push people to the outskirts of major cities like Tel Aviv, leading to productivity issues and increased living expenses. The study emphasizes the need for an efficient transport system that reduces travel time to city centers to alleviate these challenges.
Transport and Housing Integration
The researchers advocate for transit-oriented development, where transport and housing are intertwined in urban planning. Examples from cities like Singapore, Copenhagen, and Tokyo showcase successful integration of transport and housing planning for sustainable urban development.
The study recommends increasing housing density near public transport routes, fostering public-private partnerships, and financing transport projects through land value appreciation. Implementing these strategies, alongside long-term planning, can help reduce the cost of living and improve productivity in Israel.
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