Driverless cars, transport innovation, and urban economics: the danger of policy localization—Riggs, 2019

Shared and networked automobiles, autonomous vehicles, and other transportation innovations present potential and difficulties for reshaping cities and improving their socio-economic health. While autonomous vehicles are designed to prevent crashes and improve mobility and access, little is done to plan for their secondary effects on the built environment and urban economies (Riggs and Boswell 2016). Opportunities exist to transform cities, connect people to jobs, and maximize space and trips (Fagnant and Kockelman 2014; Guerra 2015b). New transportation technology's greatest promise lies in how it's applied and used to effect cities - everything outside the automobile. Laggard policy. While there has been plenty of discussion over the pros and cons of this (Fagnant and Kockelman 2014), including excellent documentation of the data science and machine learning side of the advances (Lipson and Kurman 2016), little attention has been paid to economics and policy decisions that should be made—especially given that land use and transportation actions have long inertial lags and technological growth continues to outpace urban planning. Several states have approved laws regulating the usage and implementation of autonomous vehicles, albeit to varied degrees. Commercial adoption is still in the works. Uncoordinated and inconsistent regulatory standards are a big issue. Only 2 of the 25 largest cities mention autonomous or linked vehicles in their plans (Guerra 2015a). Futuristic appraisal is essential to frame the impact on local economies and policies to steer technological development across countries. This study addresses the economic and policy consequences of modern mobility, especially driverless vehicles, and what policy thinking is needed to design a sustainable and just future. We focus on two questions that frame modern mobility and the paradigm cities may adopt in the future: I How will they change as they become increasingly populated and seek economic prosperity? How does increasing mobility affect real estate and economic competitiveness? Real estate and innovative mobility drive just economies and compassionate capitalism. Using a street deconstruction technique that analyzes economic value generation from right-way-recapture, we evaluate the potential autonomous cars present for this sector and hypothesis on the implications to current real estate holdings. We then examine the logistics sector's increased driving and delivery efficiencies and revenues and profits. Finally, we predict the possible productivity improvement based on time saved not driving. Using these components, we calculate the potential impact on GDP across G20 countries and undertake a sensitivity analysis to evaluate productivity gain over time given alternative policy/regulatory scenarios country-by-country. Due to landscape repurposing and car ownership changes, we foresee a huge boost in economic potential, especially in the $7.5 trillion real estate sector. Several other sectors should grow, boosting GDP. We think that sophisticated transportation engineering policy will be key to this expansion. If policy is localized, we expect slower rollout of new technology and slower economic growth. This leads to a debate of new and developing markets, specifically the commoditization of roadways and how they might be exploited for public good through pricing, use limitations, or divestiture.

Riggs, W., & Shukla, S. (2019). Driverless cars, transport innovation, and Urban Economics: The danger of policy localization. Transportation Research Procedia, 41, 535–536. https://doi.org/10.1016/j.trpro.2019.09.091