What if eliminating the accident death externalities of pre-automobile transport systems, is only a fraction of the story of the externality equation? The shift to automobility certainly created massive positive externalities that we have taken for granted instead of crediting it to automobility. It is unfortunate that so many "popular" policy approaches to "reducing the negative externalities of automobility" end up foregoing positive externalities such as systemically affordable housing markets, the dispersion of urban pollution, the availability and reduced cost of land enabling productivity gains, and new clustering economies that could not exist otherwise.
And getting back to some pretty obvious gains that seem to have been forgotten; horses and draft animals were responsible for public health externalities in urban areas; and the land required to grow food for them was of considerable volume adjacent to cities, much more of it in fact, that urban sprawl has swallowed up since.
I think we can keep the positive externalities (most of them) without having (most of) the negative externalities. We have an aviation system that doesn’t actively kill anyone (due to safety issues), but still pollutes. But I believe we could have a system with alternative energy sources that did neither, with very little price uplift at scale. But now we underprice automobility(obviously) and so over consume it and so have excess negative externalities — even if you allow for a fixed value of life —, and underspend on seeking change.
I agree that we can keep the positive externalities without having most of the negative ones. I partly agree that we underprice automobility, but it is a question exactly what we are overconsuming and how best to address each factor we are overconsuming. The cost of automobility is in fact mostly borne by automobile users when we consider that, as a system, most of the cost is in the purchase and operation of the vehicles themselves. Then much of the external costs, especially congestion delay, is borne by the operators of the vehicles too. The "pricing" we need to apply to resolve the negative externalities, would only represent a small percentage increase in the cost borne by the vehicle owner-operators; it is crazy that we don't do it. There is massive consumer surplus in automobility, which is why the "underpricing" of it might not be as significant as you think.
Currently we have policy makers assuming that prescriptive regulation of urban form is what we need to do, and are doing, to solve the negative externalities of automobility! But this is crazy - it has unintended consequences that increase the very externalities we claim to be addressing! Co-location is actually far more important than density; you can have low density and efficient co-location, and you can have, and we often do, have arbitrary density increases that play out into "pricing out" decreasing co-location! If we kept the urban land rent curve low by allowing greenfields development (even if the option ends up not being driven by the market), people responding to road and fuel charging would be more able to co-locate.
I regard the most important thing to establish in these current policy discussions, as the distortions to urban land rent and their consequences if we choose prescriptive land rationing as the "best" and only strategy.
Road pricing done right, would also INCREASE the distance drivers can travel in a given time, which is not a bad thing if less negative externalities rather than more, are created in the process. One thing that is certain is that the net of positive externalities over negative, would be increased.
I agree to an extend Phil. We always look at what is happening now, the unwanted consequence, not the totality of benefits. But, being reasonable, the unwanted consequence is what we need most urgently to resolve. The benefits and the systems that created them are not really in danger!
I believe the benefits and the systems that created them actually have been eroded by the "popular" policy approaches so far. If we were using "pricing" and technological advances to resolve the problems, we could avert the obvious losses we have imposed on ourselves, in housing unaffordability and its attendant social pressures; lost productivity; and concentration of urban pollution; and "unintended consequences" such as "pricing out" causing longer commutes rather than shorter, worsened congestion increasing pollution and travel times, and infrastructure costs ending up higher rather than lower (because there was NOT spare capacity in existing built areas and there was not economic accessibility to underground services for their expansion).
I may be missing something, but that sounds essentially like the past should have thought of the future and priced for it, which never really happens; and taking the easy and popular option is a surprise by the polity which it isn't! But of course in all of that is super complexity. When we were working on Green Square the need for additional underground everything was required, which may have seemed uneconomic, but also it occurred when replacement of much failing infra was also required, so then by the magic it switched to a cost saving to put everything in at once...
That was a rare enough occurrence to be like magic! What I am talking about, is that the past did not "Plan" for what it built, to be "intensified". Therefore intensification is not the magic bullet that those who regard disallowing greenfields growth as an imperative, might assume. Here and now, we should "price", and hasten the adoption of new technology, to solve externality problems. Urban growth containment and intensification as a strategy to resolve the externalities associated with automobility is an absurd approach and yet it is the one being adopted everywhere. Anthony Downs in his book "Still Stuck in Traffic" makes the following analogy: we have a picture on the wall of the living room and it looks like it is in the wrong place. Do we 1) move the picture - which would be "pricing" - or 2) jack up the whole house and move it around the picture until it looks right? - which is "changing urban form" to try and affect variables that we could simply control directly.
There is actually nothing inherently externality - INCREASING about new greenfields development for "urban" use and nothing inherently externality - DECREASING about "intensification instead". There are 1000 ways in which individuals can choose to mitigate the externalities we wish to mitigate; if we impose one unwieldy top-down "solution" on everyone, we reap unintended consequences that can be worse than the problem (eg housing unaffordability and historically unprecedented zero sum wealth transfers are not trifles); we can even increase some of the time, the very externalities we claim to be trying to decrease!
I would encourage you to read Noahopinion (Noah Smith) and his techno optimism/economics substack. Innovation happens in multiple dimensions, speeds and criticality continuously. I always think the irony is that we have the wealthiest, healthiest, most peaceful population in history but to achieve it we may have ended the world! On the "exciting" re maintenance and ops I look forward to hearing it. It is simply not true that politicians and the public are not excited by maintenance, just that it is expressed in the negative. When regular levels of service fail (trains, buses or roads) the public and media get very aggressive with the elected officials. Smart officials celebrate the level of service and justify the opex to avoid new capex. All the travel times savings palaver for new stuff and nobody seems to get that people move less speedily on poorly maintained services and infra! And with the amount of new infra coming into existence following this massive capital spend on the east coast if nobody is paying due attention to budgeting, efficiency and effort allocation a great deal of waste and unnecessary asset degradation will occur. See potholes after floods as a prime example.
What if eliminating the accident death externalities of pre-automobile transport systems, is only a fraction of the story of the externality equation? The shift to automobility certainly created massive positive externalities that we have taken for granted instead of crediting it to automobility. It is unfortunate that so many "popular" policy approaches to "reducing the negative externalities of automobility" end up foregoing positive externalities such as systemically affordable housing markets, the dispersion of urban pollution, the availability and reduced cost of land enabling productivity gains, and new clustering economies that could not exist otherwise.
And getting back to some pretty obvious gains that seem to have been forgotten; horses and draft animals were responsible for public health externalities in urban areas; and the land required to grow food for them was of considerable volume adjacent to cities, much more of it in fact, that urban sprawl has swallowed up since.
I think we can keep the positive externalities (most of them) without having (most of) the negative externalities. We have an aviation system that doesn’t actively kill anyone (due to safety issues), but still pollutes. But I believe we could have a system with alternative energy sources that did neither, with very little price uplift at scale. But now we underprice automobility(obviously) and so over consume it and so have excess negative externalities — even if you allow for a fixed value of life —, and underspend on seeking change.
I agree that we can keep the positive externalities without having most of the negative ones. I partly agree that we underprice automobility, but it is a question exactly what we are overconsuming and how best to address each factor we are overconsuming. The cost of automobility is in fact mostly borne by automobile users when we consider that, as a system, most of the cost is in the purchase and operation of the vehicles themselves. Then much of the external costs, especially congestion delay, is borne by the operators of the vehicles too. The "pricing" we need to apply to resolve the negative externalities, would only represent a small percentage increase in the cost borne by the vehicle owner-operators; it is crazy that we don't do it. There is massive consumer surplus in automobility, which is why the "underpricing" of it might not be as significant as you think.
Currently we have policy makers assuming that prescriptive regulation of urban form is what we need to do, and are doing, to solve the negative externalities of automobility! But this is crazy - it has unintended consequences that increase the very externalities we claim to be addressing! Co-location is actually far more important than density; you can have low density and efficient co-location, and you can have, and we often do, have arbitrary density increases that play out into "pricing out" decreasing co-location! If we kept the urban land rent curve low by allowing greenfields development (even if the option ends up not being driven by the market), people responding to road and fuel charging would be more able to co-locate.
I regard the most important thing to establish in these current policy discussions, as the distortions to urban land rent and their consequences if we choose prescriptive land rationing as the "best" and only strategy.
Road pricing done right, would also INCREASE the distance drivers can travel in a given time, which is not a bad thing if less negative externalities rather than more, are created in the process. One thing that is certain is that the net of positive externalities over negative, would be increased.
I agree to an extend Phil. We always look at what is happening now, the unwanted consequence, not the totality of benefits. But, being reasonable, the unwanted consequence is what we need most urgently to resolve. The benefits and the systems that created them are not really in danger!
I believe the benefits and the systems that created them actually have been eroded by the "popular" policy approaches so far. If we were using "pricing" and technological advances to resolve the problems, we could avert the obvious losses we have imposed on ourselves, in housing unaffordability and its attendant social pressures; lost productivity; and concentration of urban pollution; and "unintended consequences" such as "pricing out" causing longer commutes rather than shorter, worsened congestion increasing pollution and travel times, and infrastructure costs ending up higher rather than lower (because there was NOT spare capacity in existing built areas and there was not economic accessibility to underground services for their expansion).
I may be missing something, but that sounds essentially like the past should have thought of the future and priced for it, which never really happens; and taking the easy and popular option is a surprise by the polity which it isn't! But of course in all of that is super complexity. When we were working on Green Square the need for additional underground everything was required, which may have seemed uneconomic, but also it occurred when replacement of much failing infra was also required, so then by the magic it switched to a cost saving to put everything in at once...
That was a rare enough occurrence to be like magic! What I am talking about, is that the past did not "Plan" for what it built, to be "intensified". Therefore intensification is not the magic bullet that those who regard disallowing greenfields growth as an imperative, might assume. Here and now, we should "price", and hasten the adoption of new technology, to solve externality problems. Urban growth containment and intensification as a strategy to resolve the externalities associated with automobility is an absurd approach and yet it is the one being adopted everywhere. Anthony Downs in his book "Still Stuck in Traffic" makes the following analogy: we have a picture on the wall of the living room and it looks like it is in the wrong place. Do we 1) move the picture - which would be "pricing" - or 2) jack up the whole house and move it around the picture until it looks right? - which is "changing urban form" to try and affect variables that we could simply control directly.
There is actually nothing inherently externality - INCREASING about new greenfields development for "urban" use and nothing inherently externality - DECREASING about "intensification instead". There are 1000 ways in which individuals can choose to mitigate the externalities we wish to mitigate; if we impose one unwieldy top-down "solution" on everyone, we reap unintended consequences that can be worse than the problem (eg housing unaffordability and historically unprecedented zero sum wealth transfers are not trifles); we can even increase some of the time, the very externalities we claim to be trying to decrease!
I would encourage you to read Noahopinion (Noah Smith) and his techno optimism/economics substack. Innovation happens in multiple dimensions, speeds and criticality continuously. I always think the irony is that we have the wealthiest, healthiest, most peaceful population in history but to achieve it we may have ended the world! On the "exciting" re maintenance and ops I look forward to hearing it. It is simply not true that politicians and the public are not excited by maintenance, just that it is expressed in the negative. When regular levels of service fail (trains, buses or roads) the public and media get very aggressive with the elected officials. Smart officials celebrate the level of service and justify the opex to avoid new capex. All the travel times savings palaver for new stuff and nobody seems to get that people move less speedily on poorly maintained services and infra! And with the amount of new infra coming into existence following this massive capital spend on the east coast if nobody is paying due attention to budgeting, efficiency and effort allocation a great deal of waste and unnecessary asset degradation will occur. See potholes after floods as a prime example.