Driving people mad

Traffic. Always a big concern.

Unless you are unplugged from the world, what is happening out there in the streets always bothers you. Even when you are staying at home, it still can drive you mad for your pizza delivery is late because of traffic jam. And if you are in a developing country, the situation may get worse due to the lack of public transport, according a popular belief. However, it may be not true. In developed countries such as USA, lines of car waiting in street is a very common scene. It has me wonder about the true solution for traffic jam? Why does public transportation help? Of course I am not able to give a practically ultimate solution, though I really want to. What I am trying to do is to provide an economic perspective for this problem.

What causes a traffic jam? Mostly personal transportation, from small vehicles such as motorbikes, bikes to big machine like cars, trucks, buses. Some people may not contain bikes in this list, just because it is environmentally-friendly. However, when it comes to traffic, bikes are even worse than motorbikes for it only carries one person while taking a similar amount of space as motors. Traffic jam has a “price”. It is the cost of energy and time lost when you get stuck. Therefore, reducing traffic jam is one of the most priorities of all governments in the world.

If we consider traffic as a product, there are 2 ways to reduce the “price” of traveling: to increase supply or to decrease demand.

To increase the supply for traffic sounds a little bit vague. Put simple, it is to make more space for traveling. And to achieve that goal, we often choose to improve the infrastructure, which means building more roads, more streets, more bridges, more tunnels… It only takes a little time for this solution to take effect. When the new road is completed, almost immediately traffic on that road will be better. Vehicles can move faster because there is more space available. The same effect happens when it comes to public transportation. If people change from driving a car to taking a bus, the street will be less crowded and therefore creates more space. That is why most of budget used to improve traffic is spent on building roads and buying buses. However, though the effect is obvious and instant, it does not last long. Sooner or later the street will be full of transports again, even when the population does not increase much. How can it be possible? It is because if the traffic is better, it will lead to a greater desire to use personal transportation. When facing the fact that they may get stuck in a street for 3 or 4 hours, people give up the idea of buying a car or go out at rush hour. But now the streets are bigger and many people are taking bus, why worry about the traffic jam? Let’s buy a new SUV and enjoy the streets. And 2 years since the new metro, everything is bad again. Since roads are public goods, everyone wants to take the most out of it. Therefore, no matter how big your road-to-be is or no matter how effective your city’s public transportation is, traffic jam will always come back.

For increasing supply does not help much, we need to turn to the second solution: kill the demand.  The number of transports should be decreased. One of the easiest ways is to use tax or fee. But as all economics books say, taxes will create a dead-weight-loss for the whole society. Therefore, taxing is not a good answer. However, we can easily notice that traffic jam is not an every time and everywhere phenomenon. Only at some specific moment and at a certain amount of places. It gives us a hint about how to solve the problem: redistribution. We need to rearrange the time people go out. We need to rearrange the routine people take. We cannot rush out at the same moment. Neither can we travel in the same streets. We need a better time table for everyone.

We can see that before the working time, everyone rushes to downtown. On the contrary, in the evening, the crowd moves back to the suburban areas. The traffic is, therefore, like a pendulum, swinging from one place to another with all of its weight. If we can make people work in their neighborhood, things will be improved. They do not have to travel a long distance to their office. Student will walk to school instead of jumping in a car. We will not NEED to travel in the street much. As a result, there will more space for those who really need to travel.

Of course, once again, all the solutions above are just pure theory. Building a road is easy. Reorganizing the whole city is much tougher. But given the current technology in transportation, it is the ultimate solution for this complicated problem.

Kz