Download StudyGeneral

Study Overview

Efficiency of Informal Transit Networks: Evidence from Lagos, Nigeria
Study is 3ie funded:
Study ID:
Initial Registration Date:
Last Update Date:
Study Status:
United States

In many low and middle income country cities, transit is private: operated by many small companies, some so small they only own a single bus. This system is flexible, but can be disorganized. Bus drivers try to steal business from each other, leading to dangerous driving, congestion, and pollution. As cities become wealthier, they often invest in formal transit, like centrally managed rail or buses. Such a transition occurred a generation ago in rich cities. It is now being replicated in emerging cities. However, centralized transit is expensive. How much should developing cities invest in formalizing transport? How can formal and informal transit best complement each other? Under what circumstances is it better to rely mostly on informal transit? The choices made today may crystallize the shape of these growing cities for generations.

Little is known about the workings of current decentralized informal transit networks, and thus how they could be improved. This project will analyze how the informal transit system in Lagos responds to a large-scale public transit intervention. We will evaluate the impact of the roll-out of public buses on 25 routes previously served only by informal minibuses, in partnership with the Lagos State authorities and the Lagos Metropolitan Area Transport Authority. It is not clear what to expect: public buses might displace informal transit, or actually improve it, by increasing demand throughout the network. We will study demand for public

Registration Citation:

Efficiency of Informal Transit Networks: Evidence from Lagos, Nigeria - ongoing project (2020) D. Björkegren, A. Duhaut, N. Tsivanidis.

Additional Keywords:
Secondary ID Number(s):

Principal Investigator(s)

Name of First PI:
Alice Duhaut
The World Bank
Name of Second PI:
Nick Tisvanidis
University of California, Berkeley

Study Sponsor

The World Bank
Study Sponsor Location:
United States

Research Partner

Name of Partner Institution:
Lagos Metropolitan Area Transport Authority
Type of Organization:
Government agency (eg., statistics office, Ministry of Health)

Intervention Overview


Lagos State government launched its Bus Reform Initiative (BRI), which will introduce 700 high-capacity buses along 46 routes throughout the city.

These buses will use e-ticketing systems and swipe cards for users, and connect through new transport terminals constructed at Ikeja, Oyingo and Oshodi with more in process of construction. This project is rolled out by the Lagos Metropolitan Area Transportation Authority (LAMATA), the transport regulator for Lagos State. The buses and infrastructure are owned by the state, but rented and operated by 5 private operators. In addition to the 48 trunk lines along high demand routes, a number of “first- and last-mile” routes will be introduced that use smaller capacity buses to bring passengers into BRI terminals along lower demand “feeder” routes. While there are no restrictions on danfo operations along these new routes, these services will directly compete with informal incumbents for passengers.

Our impact evaluation will study the effects of 18 new trunk routes that will be opened in Fall 2020 and Spring 2021. We will also collect data on 27 feeder routes that will open over the same period; our analysis will at times pool these two variants while other times separating them (as the treatment effects may differ between them).

The line openings of the BRI we will study constitute the first part of a large-scale strategic plan for reforming public transit in Lagos state. A total of 256 routes have been planned in 7 zones across the city. These are based on previous consultations and travel demand and supply studies, existing transport hubs, infrastructure availability. The five existing operators will be operating the new routes, with a different design for the buses in each zone. 

Theory of Change:

Introducing a formal system that competes for passengers could affect the transport sector in several ways. It will provide commuters access to safer and newer public buses. But providing this new public option can also affect the options provided by the informal sector.  In the short run, we expect danfo drivers to shift from routes where they face new competition to nearby routes that remain informal. In the long run, some danfo drivers may drop out of the industry, and competition might drive prices down. However, these effects are ambiguous. The formal system may crowd out the informal system. But if network effects are strong enough, formalizing one route could cause even more danfo drivers to enter on connected routes, which have become more useful. The effect on travel and wait times are also theoretically ambiguous. If enough informal buses exit, wait times could actually increase on formalized routes; it may decrease on connected routes. Formal buses may be faster or slower: they may drive more safely (slowly), but also may spend less time waiting to fill up with passengers. Formalization may also reduce congestion. We expect passengers to value the introduction of safer and more reliable public transport. But we expect that the net effects of formalization will differ in different parts of the city due to route characteristics (underlying demand along origin-destination; connectivity to other routes; preferences for price and safety).

Multiple Treatment Arms Evaluated?

Implementing Agency

Name of Organization:
Lagos Metropolitan Area Transport Authority
Type of Organization:
Public Sector, e.g. Government Agency or Ministry

Program Funder

Name of Organization:
Lagos State/ Lagos Metropolitan Area Transport Authority
Type of Organization:
Public Sector, e.g. Government Agency or Ministry

Intervention Timing

Intervention or Program Started at time of Registration?
Start Date:
End Date:
Evaluation Method

Evaluation Method Overview

Primary (or First) Evaluation Method:
Difference in difference/fixed effects
Other (not Listed) Method:
Additional Evaluation Method (If Any):
Other (not Listed) Method:

Method Details

Details of Evaluation Approach:

The  impact evaluation will provide reduced form estimates of the impact of the BRI on the informal sector and commuter behavior. Our primary identification strategy compares changes in outcomes along routes that are opened during the BRI with those along routes that were planned but not opened. These should be similar to the BRI routes which did open as they are all included within Lagos State’s overall bus reform plan. Moreover, we exploit the changes in route plans that occurred due to problems and delays in procuring buses to open more routes to further distinguish in the control group between routes that were scheduled to open and those that were not (the former were naturally high priority routes, and should therefore be yet more comparable to the opened routes).

Outcomes (Endpoints):

Primary: Travel Time

Primary: Transport schedule (informal)

Primary: Travel cost (informal)

Primary: Transport schedule (public)

Primary: #passengers transported

Secondary: Informal transport capacity

Secondary: Informal transport operator revenue

Secondary: route choice

Secondary: Road crashes

Unit of Analysis:
Route level

Informal Operators: In response to an increase in competition,

  • How do informal incumbents change prices and frequencies?
  • How much do drivers substitute to other routes, and what factors influence their location choices?
  • Do they compete or complement the new formal option, and what network characteristics does this depend on?
  • How are informal bus operators’ income and employment affected?


  • How do consumers value attributes from formal and other transportation modes?
  • Which modes do users of high-quality formal transit substitute from?


Equilibrium Outcomes

  • How do congestion and accidents change with the composition of vehicles?

How are danfo queues and wait times at bus stops impacted?    

Unit of Intervention or Assignment:
Number of Clusters in Sample:
Number of Individuals in Sample:
Size of Treatment, Control, or Comparison Subsamples:

Outcomes Data

Original driver survey data
Data Already Collected?
Data Previously Used?
Data Access:
Data Obtained by the Study Researchers?
Data Approval Process:
Approval Status:

Treatment Assignment Data

Participation or Assignment Information:
Data Obtained by the Study Researchers?
Data Previously Used?
Data Access:
Data Obtained by the Study Researchers?
Data Approval Process:
Approval Status:

Data Analysis

Data Analysis Status:

Study Materials

Upload Study Materials:

Registration Category

Registration Category:
Prospective, Category 1: Data for measuring impacts have not been collected

Completion Overview

Intervention Completion Date:
Data Collection Completion Date:
Unit of Analysis:
Clusters in Final Sample:
Total Observations in Final Sample:
Size of Treatment, Control, or Comparison Subsamples:


Preliminary Report:
Preliminary Report URL:
Summary of Findings:
Paper Summary:
Paper Citation:

Data Availability

Data Availability (Primary Data):
Date of Data Availability:
Data URL or Contact:
Access procedure:

Other Materials

Survey Instrument Links or Contact:
Program Files:
Program Files Links or Contact:
External Link:
External Link Description:
Description of Changes:

Study Stopped