Institute of Transportation, MOTC

　　Based on population density, this paper divides a total of 348 townships/districts in Taiwan (except for off-shore islands) into five categories: highly remote area, remote area, suburban, urban and central business centre (CBD) to investigate the rationales behind their potential demand, essential demand, supply density of public transportation as well as their allocated subsidies. The results show that highly remote areas tend to have a highly essential demand but low public transportation supply and deficit subsidy, suggesting the inappropriateness of current operating deficit subsidy policy. Improvement directions proposed accordingly.