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Elliot Eisenberg, Ph.D.
GraphsandLaughs, LLC
August 2016
At present there are 240 million cars and light trucks in the USA, most of which are parked 23 hours a day or more. This idleness makes owning and driving a car expensive. If cars could just be used more, automobile transportation costs would fall. That is the promise of Uber, Lyft and all the other assorted ride hailing services. But, what about the next step, driverless cars? With no driver to pay, travel becomes even cheaper. What does the promise of cheaper transportation mean for cities, commutes, sprawl, and more generally how we live? I suggest it will encourage sprawl by increasing the distance of our commutes. Here’s why:
As goods and services get cheaper we generally consume more of them. For example, long distance phone calls were once prohibitively expensive and we made them rarely. Today, they are free and we make lots of them. Televisions used to be very costly; a house had just one. Now, every room has a TV. Several years ago, gasoline was $4/gallon and owning a Prius was a status symbol. Now, with gasoline at $2.25/gallon, we are buying gas guzzlers by the gross and driving more too. In short, as something gets cheaper, we generally consume more of it.
Returning our attention back to driverless cars, as new technologies and roads are built to specifically accommodate these vehicles, their transformative potential will become apparent. They will not only be safer than existing cars, but will travel faster and get much better gas mileage. And, shared self-driving cars are expected to easily take 50% of existing cars off the road. Suddenly the cost of conveying a passenger is likely to be not much more than double or triple the cost of public transit. Better yet, hailing such a vehicle from the permanent circulating fleet will take little time and no more than a swipe or two on your smart phone. As a bonus, on-street parking and most off-street parking would completely disappear.
In short, we are on the verge of faster, safer, and cheaper travel. Add to this the twin observations that people generally are willing to commute about 30 minutes to get to work, and that (possibly as a result), urban population densities have generally been declining by about 1%/year since about 1890, and you have a strong likelihood that the cost and time savings these new modes of travel promise will result in longer distance commutes, and thus continued sprawl. In short, the easier it is to get from “Here” to “There”, the farther away from “There” people are apt to live.
Moreover, this outcome is highly likely no matter how things turn out. If we enthusiastically embrace ride-sharing technology, something Americans have never done, we will all be whisked speedily to our now ever-distant places of work and sprawl continues. By contrast, if few of us ride-share and we instead use our own self-driving cars, which is probably more likely, it would mean more cars on the road and thus slightly slower speeds than what could be achieved via mass ride-sharing and thus longer commutes. But we would all be watching TV or reading so who cares!
Elliot Eisenberg, Ph.D. is President of GraphsandLaughs, LLC and can be reached at Elliot@graphsandlaughs.net. His daily 70 word economics and policy blog can be seen at www.econ70.com. You can subscribe to have the blog delivered directly to your email by visiting the website or by texting the word “BOWTIE” to 22828.
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