Household Size as a Determinant of Annual Shelter and Transportation Expenditures in Canada

In Canada, households spend the most significant portions of their annual income on shelter and transportation. Recent academic literature has suggested that increased investments in shelter can reduce annual transportation costs for household. The rationale behind this trade off has traditionally been density, whereas those households living in high density neighborhoods have access to additional forms of transportation which invariably lowers annual transportation expenditures. Using data from the 2008 Survey of Household Spending, respondent households within urban communities of 100,000 or more persons in Quebec, Ontario, Alberta and British Columbia were used to test the assumed trade-off curve. The analysis provided shows that increases in shelter expenditures will lead to an increase in transportation expenditures in all cases, and that households size, not density, is the determining variable. The analysis provided is intended to make academics and urban planners reconsider their presumptions about density as they plan for an increasing urban population across the nation.