Seminarios académicos y conferencias
Welfare Impacts of Autonomous Vehicles and City Development
22 noviembre 2017 - 15:30 hrs.
Sala 113, Facultad de Ciencias Económicas y Administrativas UC
Abstract: Based on the most recent predictions from the engineering literature, this paper builds an economic model to study the effects of autonomous technology on cities. Contrary to the conventional wisdom that autonomous vehicles increase sprawl, our model predicts that foremost city centers will become more attractive places to live with potentially vastly improved quality of life. This effect is mainly due to the feature that self-driving vehicles demand only a small fraction of the existing parking lots in city centers. Future developments of the large number of existing parking lots (creating new pedestrian walkways, bicycle lanes, recreational parks, community centers and housing) increase the livability in urban centers. Suburbs become more expensive in those areas that are linked to pre-existing amenities. However, real estate in unattractive areas will decrease in price. Self driving cars will lead to more sprawl, but only if “vehicle miles traveled” remain un-taxed. Because of the loss in gasoline tax (assuming self-driving vehicles go electric), governments could soon implement congestion charges in the form of pricing the vehicle miles traveled. Due to car sharing, and a potential tax on the VMT, the immediate cost of each trip will become more obvious to the consumer, dis-incentivising long daily commutes and thereby limiting sprawl. These results, of course, highly depend on the precise regulation of autonomous transportation and city management. For example, cities could suffer from increasing congestion if cities do not redesign regulations and city codes to redevelop parking. Similarly, sprawl and rural land use could increase if a VMT tax is not implemented. This paper concludes with policy recommendations how to manage the transition to a driver-less future in order to increase the social welfare gains that this new technology may enable. Finally a back of the envelope calculation shows that self-driving vehicles can generate trillion of dollars in welfare, induced by environmental, safety and urban amenities. Distributional welfare effects across various sub-populations are discussed. We also highlight the role of the potential adoption of electric vehicles in this context.