And that’s usually true.
But some frictions are load-bearing. Get rid of the friction, and important things can start falling over.
Last week, Ben Southwood at the superb Works in Progress Newsletter worked through one of these load-bearing frictions. It’s one that will matter in a few years in the United States, and perhaps in about a decade in New Zealand.
Driving is a little bit of a hassle. It takes your time and at least some attention. It’s hard to do other things while you’re driving, even if your phone is well-configured for working hands-free. Or, at least, it’s harder while driving than while sitting at a desk.
It sounds banal because it is. But it’s a load-bearing banality. Take it away without putting some other grit into the system, and cities will seize up.
Southwood explains what will happen when enough of us have switched to self-driving cars.
Driverless cars are amazing. Their owners can summon them to their location, tell them where they need to go, and be chauffeured to their destination without ever having to touch the steering wheel.
Waymo has not yet made it to New Zealand. But Tesla owners can have Full Self-Driving (supervised) as a $159/month subscription. Others will follow and costs will keep coming down.
And so far they seem safer than human drivers. American car insurance company Lemonade even offers a substantial discount to drivers who use Tesla’s Full Self-Driving (supervised) rather than taking the wheel themselves.
And Southwood notes that fully self-driving Waymos have 80 percent fewer accidents.
The shift to self-driving will likely substantially lower the number of injuries and fatalities on the road. Insurance that appropriately charges higher premiums for riskier driving could make self-driving systems an excellent bargain.
But it isn’t the only change that will come.
Normally, if you drive your car into town, you have to find somewhere to park. In places where parking is scarce, sensible cities charge for parking. In business districts you might be able to park briefly for free, then find a paid spot. Paid spots can be to a timed maximum, so spaces turn over rather than being used for all-day parking.
All of that works because of a useful friction. Nobody sensible would leave their office every half hour to move the car between spaces that only allow 30 minutes of parking. You’d spend more time running back and forth to the car than you’d spend at work, and you’d likely be fired.
But it won’t be long before self-driving cars can manage that on their own. They can drive themselves. They can park themselves. Whenever paid parking is more expensive than the electricity a car will use in flitting between free spaces, the car will be able to take care of it on its own.
Southwood points to Amazon’s Zoox, a self-driving taxi that can double as a mobile office-space. Why have a business meeting in a coffee shop if a comfortable, private, driverless cab can take you on a scenic tour and get everyone to their next meeting as part of the deal? When travel time becomes usable work time, or leisure time, people will choose to consume a lot more road space.
So long as road use isn’t priced properly, the problems become obvious. Cities could easily become gridlocked. And versions of congestion charging that only charge for entry into a downtown area, without accounting for the amount of travel within the charged zone, won’t solve the problem.
But roads can be priced properly. And New Zealand is better positioned than other places to get things right.
One part of the fix is already underway.
Currently, petrol-powered vehicles pay for their use of the roads through charges on petrol: the Fuel Excise Duty. Diesel and electric vehicles pay per-kilometre Road-User Charges. The government expects to introduce legislation that will shift petrol vehicles onto RUC while abolishing petrol taxes (the carbon charge incorporated into the price of petrol and diesel will remain in place).
Heavy trucks already use electronic road user charging. The government aims to enable that kind of option for all vehicles.
Distance-based charging is an improvement. But a kilometre travelled during rush hour is more socially costly than a kilometre travelled when the roads are empty.
Legislation has already passed, with support of all parties in Parliament, enabling congestion charging in cities.
It is not hard to imagine congestion charging integrating with electronic road user charging and toll collection. Your route would then carry a per kilometre charge, and a congestion charge if you travel at peak times.
The simplest congestion charging systems track whether your vehicle has crossed into an area subject to congestion charging during times that draw charges. They are not perfect, but they are good enough when driving is a bit of a hassle.
They will not be good enough when you can ask your car to spend its day circling the block rather than pay for parking.
When you park your car downtown, you generally have to pay rent on the space, whether to the city for on-street parking or to the owner of a private lot. In a crowded downtown at peak times, a moving car can impose a higher opportunity cost on everyone else than a parked one.
By the time autonomous vehicles are prevalent enough for any of this to be a real problem, electronic road user charging will be ubiquitous.
At that point, a small tweak to congestion charging systems could prevent Southwood’s gridlocked nightmare from coming true. Just lower the charge for entering the congested zone while adding a per-minute charge for time spent driving there when the roads are congested. The average ride during peak hours would cost the same amount, but having your car spend all day jumping between parking spots would get expensive.
Autonomous vehicles will remove one of driving’s basic frictions, and that friction might be load-bearing. Proper congestion pricing could provide just the right amount of friction to keep the roads moving.
Dr Eric Crampton is Chief Economist at the New Zealand Initiative. This article was first published HERE
Driving is a little bit of a hassle. It takes your time and at least some attention. It’s hard to do other things while you’re driving, even if your phone is well-configured for working hands-free. Or, at least, it’s harder while driving than while sitting at a desk.
It sounds banal because it is. But it’s a load-bearing banality. Take it away without putting some other grit into the system, and cities will seize up.
Southwood explains what will happen when enough of us have switched to self-driving cars.
Driverless cars are amazing. Their owners can summon them to their location, tell them where they need to go, and be chauffeured to their destination without ever having to touch the steering wheel.
Waymo has not yet made it to New Zealand. But Tesla owners can have Full Self-Driving (supervised) as a $159/month subscription. Others will follow and costs will keep coming down.
And so far they seem safer than human drivers. American car insurance company Lemonade even offers a substantial discount to drivers who use Tesla’s Full Self-Driving (supervised) rather than taking the wheel themselves.
And Southwood notes that fully self-driving Waymos have 80 percent fewer accidents.
The shift to self-driving will likely substantially lower the number of injuries and fatalities on the road. Insurance that appropriately charges higher premiums for riskier driving could make self-driving systems an excellent bargain.
But it isn’t the only change that will come.
Normally, if you drive your car into town, you have to find somewhere to park. In places where parking is scarce, sensible cities charge for parking. In business districts you might be able to park briefly for free, then find a paid spot. Paid spots can be to a timed maximum, so spaces turn over rather than being used for all-day parking.
All of that works because of a useful friction. Nobody sensible would leave their office every half hour to move the car between spaces that only allow 30 minutes of parking. You’d spend more time running back and forth to the car than you’d spend at work, and you’d likely be fired.
But it won’t be long before self-driving cars can manage that on their own. They can drive themselves. They can park themselves. Whenever paid parking is more expensive than the electricity a car will use in flitting between free spaces, the car will be able to take care of it on its own.
Southwood points to Amazon’s Zoox, a self-driving taxi that can double as a mobile office-space. Why have a business meeting in a coffee shop if a comfortable, private, driverless cab can take you on a scenic tour and get everyone to their next meeting as part of the deal? When travel time becomes usable work time, or leisure time, people will choose to consume a lot more road space.
So long as road use isn’t priced properly, the problems become obvious. Cities could easily become gridlocked. And versions of congestion charging that only charge for entry into a downtown area, without accounting for the amount of travel within the charged zone, won’t solve the problem.
But roads can be priced properly. And New Zealand is better positioned than other places to get things right.
One part of the fix is already underway.
Currently, petrol-powered vehicles pay for their use of the roads through charges on petrol: the Fuel Excise Duty. Diesel and electric vehicles pay per-kilometre Road-User Charges. The government expects to introduce legislation that will shift petrol vehicles onto RUC while abolishing petrol taxes (the carbon charge incorporated into the price of petrol and diesel will remain in place).
Heavy trucks already use electronic road user charging. The government aims to enable that kind of option for all vehicles.
Distance-based charging is an improvement. But a kilometre travelled during rush hour is more socially costly than a kilometre travelled when the roads are empty.
Legislation has already passed, with support of all parties in Parliament, enabling congestion charging in cities.
It is not hard to imagine congestion charging integrating with electronic road user charging and toll collection. Your route would then carry a per kilometre charge, and a congestion charge if you travel at peak times.
The simplest congestion charging systems track whether your vehicle has crossed into an area subject to congestion charging during times that draw charges. They are not perfect, but they are good enough when driving is a bit of a hassle.
They will not be good enough when you can ask your car to spend its day circling the block rather than pay for parking.
When you park your car downtown, you generally have to pay rent on the space, whether to the city for on-street parking or to the owner of a private lot. In a crowded downtown at peak times, a moving car can impose a higher opportunity cost on everyone else than a parked one.
By the time autonomous vehicles are prevalent enough for any of this to be a real problem, electronic road user charging will be ubiquitous.
At that point, a small tweak to congestion charging systems could prevent Southwood’s gridlocked nightmare from coming true. Just lower the charge for entering the congested zone while adding a per-minute charge for time spent driving there when the roads are congested. The average ride during peak hours would cost the same amount, but having your car spend all day jumping between parking spots would get expensive.
Autonomous vehicles will remove one of driving’s basic frictions, and that friction might be load-bearing. Proper congestion pricing could provide just the right amount of friction to keep the roads moving.
Dr Eric Crampton is Chief Economist at the New Zealand Initiative. This article was first published HERE
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