Speeding to a standstill

This is an interesting and useful article. The topic is timely and important. The approach and methodology are interesting.  And in it  you will find a certain number of points  which I regard as timely, important and very much worth saying again and again. In a couple of instances I find their conclusions and interpretations a bit puzzling, but let me keep them to myself for now and avoid getting between you and the authors. It's time to stand aside and let them speak for themselves.

A Need for Speed: Why Building More Roads Won't Conquer Gridlock

- - Gilles Duranton, Victor Couture and Matthew A. Turner

Published: April 24, 2013 in Knowledge@Wharton

Abstract: We investigate the determinants of driving speed in large us cities. We first estimate city level supply functions for travel in an econometric framework where both the supply and demand for travel are explicit. These estimations allow us to calculate a city level index of driving speed and to rank cities by driving speed. Our investigation

of the determinants of speed provide the foundations for a welfare analysis. This analysis suggests that large gains in speed may be possible if slow cities can emulate fast cities and that the deadweight losses from congestion are sizeable

Traffic delays prompt most drivers to think about how they can circumvent the gridlock and travel more efficiently. In a working paper -- titled "Speed" -- Wharton real estate professor Gilles Duranton and his co-authors take these calculations to the next level. They challenge the common solution used to combat most traffic problems -- increasing "supply" or the number of possible options available to get from "point A" to "point B" -- and suggest that the potential for real gains instead lies in managing travel demand, an alternative that drivers often resist and politicians are wary of legislating.

"We are trying to understand how cities produce travel," says Duranton, who authored the paper along with University of Toronto professors Victor Couture and Matthew A. Turner. "A first difficulty is that when cities are good at producing travel, people will travel more. That leads to extra congestion."

Traffic congestion imposes immediate and tangible costs in the form of hair-pulling frustration on the part of drivers, but it also results in substantial economic consequences. The researchers estimate that 71 million hours per year are lost due to congestion in an average metropolitan statistical area. That translates to about 34 hours per person per year. Valuing time lost at $11.50 per hour, the tab comes to $391 annually for the average person. In total, for the 100 U.S. metropolitan statistical areas studied, the loss for privately owned cars exceeds seven billion hours per year or $82 billion total, according to the researchers.

When the numbers were crunched, two widely held beliefs fell by the wayside, the researchers say: Neither additional traffic lanes nor more widely available mass transit alleviated traffic congestion. If municipalities build more capacity, additional drivers take to the roads until congestion returns to previous levels.

The loss more than doubles when commercial traffic waiting to move goods, and other costs such as gas, are taken into consideration, the authors add. The overall cost may still seem relatively small next to massive economic issues like health care and education, Duranton notes, but he says that by comparison, traffic congestion is so simple to fix that it cries out for attention.

Indeed, is any activity in the United States more pervasive than car travel? In 2008, cars, car payments, repairs and gasoline swallowed nearly one fifth of an average U.S. household budget. The average driver spends 1.2 hours per day on the road. As a nation, the U.S. spends about $200 billion annually on road construction and maintenance, nearly three times the proposed 2013 budget for the U.S. Department of Education.

Nor does more public transit alleviate traffic congestion to the degree that advocates in many cities have suggested. "If you manage to convince some drivers to give up on their cars, other drivers will replace them," Duranton notes.

The authors created a database to track nearly 420,000 trips, 102,000 drivers and 71,000 households in the 100 metro areas in 2008 with comparable data for 1995 and 2002. When the numbers were crunched, two widely held beliefs fell by the wayside, the researchers say: Neither additional traffic lanes nor more widely available mass transit alleviated traffic congestion. If municipalities build more capacity, additional drivers take to the roads until congestion returns to previous levels.

Urban and suburban drivers alike naturally flock to roads that are less traveled. Whereas previous research estimated that a 10% increase in road capacity in a city would spur a 3% increase in overall vehicle kilometers traveled, Duranton and his colleagues found that the figure would actually rise 10% -- exactly commensurate with the capacity of the new lane space. In other words, the benefits of the new lanes are negligible. "Basically, if you double the amount of road, the speed of traffic will go up by at most 5%," Duranton says.

Nor does more public transit alleviate traffic congestion to the degree that advocates in many cities have suggested. "If you manage to convince some drivers to give up on their cars, other drivers will replace them," Duranton notes. "When we looked at the data, we found no relationship between public transit and road travel. But that's not what people who promote transit usually say."

. . .  (Article continues in Knowledge@Wharton

* For full text of this thought-provoking summary article, click here.

* For the full text of the original paper, here.

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About the lead author:
Gilles Duranton is professor of real estate at the Wharton School of the University of Pennsylvania.  Co-editor, Journal of Urban Economics ; Co-editor, Handbook of Regional and Urban Economics (forthcoming) ; Editorial board member for several  journals ; Research fellow, Centre for Economic Policy Research ; Research Affiliate, Spatial Economics Research Centre at the London School of Economics ; Senior Fellow, Rimini Centre for Economic analysis.

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From the editor:
The authors' call for well thought out congestion pricing schemes are certainly among their most important policy recommendations. Full cost pricing! Hear, hear!

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