Fare-Free Public Transport and Female Labour Supply in India: Evidence from Staggered State Rollouts

Abstract

Female labour force participation in India remains among the lowest in the world, and the cost and difficulty of travel is one of the constraints most frequently cited by women themselves. Since 2019, nine Indian states and union territories have abolished bus fares for women on public services, beginning with Delhi and extending through Tamil Nadu, Punjab, Karnataka, Telangana, Jammu and Kashmir, Andhra Pradesh, West Bengal and Kerala. The staggered timing of these reforms provides an unusual opportunity to identify the causal effect of commuting costs on female labour supply in a low-participation setting. This paper exploits that variation using eight annual rounds of the Periodic Labour Force Survey covering 2017–18 to 2024–25, pooled into repeated cross-sections of women aged 15 to 59. Because the conventional two-way fixed effects estimator is biased when treatment timing varies and effects are heterogeneous, the analysis relies on the heterogeneity-robust estimators of Callaway and Sant'Anna (2021), Sun and Abraham (2021) and Borusyak, Jaravel and Spiess (2024), with the Goodman-Bacon (2021) decomposition used to diagnose the bias in the conventional estimator and the sensitivity analysis of Rambachan and Roth (2023) used in place of a binary pre-trend test. The preferred estimate indicates that fare abolition raises female labour force participation by approximately 2.8 percentage points against a pre-reform base of 25.6 per cent, an increase of about eleven per cent in relative terms. Effects appear only after the reform, grow over three years, and are concentrated among urban women, women with secondary education, and employment that requires travel beyond the village or town of residence. A triple-difference specification using men as an internal control, and a placebo test on male participation, both support the interpretation. The results suggest that the mobility constraint on women's work is economically substantial and that fare policy is an unusually direct instrument for relaxing it, though the fiscal cost per additional participant is high because most of the outlay accrues to women who would have travelled in any case.