Medellín’s MetroCables: Real Progress or Mirage? A causal analysis of Medellin’s MetroCables and their impact on annual income growth.

Global cities are increasingly integrating cable cars into their public transit systems. These initiatives are often motivated by the need to spur development in peripheral mountainous communities. Despite continued investment, the literature surrounding the causal relationship between cable car stations and income growth is minimal. This thesis investigates the causal impact of Medellín’s MetroCable public transit system on neighborhood-level income using a pooled difference-in-differences (DiD) model and household survey data from the Encuesta de Calidad de Vida (2004–2017). Focusing on barrios where MetroCable stops opened during the observation period (2004-2017), the analysis identifies a statistically significant causal effect: residents of treated barrios experienced an average annual income increase of over 2 million Colombian pesos relative to untreated barrios. This result reflects the estimated effect of MetroCable access while controlling for fixed differences across years and barrios, as well as socioeconomic status. Descriptive analyses of median and cumulative income growth trends further support the conclusion that treated neighborhoods outperformed their matched control groups in income growth over time.