Driverless cars beyond the hype

Everybody seems to be excited about driverless cars. The technology is advancing rapidly, and major companies are racing to bring products to market. There are some lingering worries, of course, about both the ethics and legality of driverless cars, but the benefits are so huge and obvious -- whole hours added to the day, massive reductions in stress, tens of thousands of lives saved every year -- that it will be a big surprise if driverless cars don't eventually become almost universal.

The advent of driverless cars won't just save time and lower or eliminate the hassle of driving; it will have a profound impact on the way our society is organized. This is because the technology greatly lowers the cost of moving a human being from one place to another. They do this in several ways. First, they allow work to be done in the car, meaning that the time-cost of travel is reduced. Second, they will reduce stress and risk.

When technologies lower transport costs, they make it easier to live far away from where we work, play and meet. With driverless cars, people won't be forced to live near downtown Chicago in order to work there. They will be able to shop at trendy New York boutiques while living in the distant suburbs. Cities may become places where no one lives but where everyone works and meets.

That will create pressure for urban sprawl. If it becomes feasible to live far from the city center, people will flock to the exurbs. They will build bigger houses and want to cut down more forests, putting pressure on our natural resources and requiring government curbs in order to avoid excessive destruction of natural habitats. That is sure to become a contentious political issue.

It may also cause class and racial conflicts. With cheaper transportation, people will be more able to self-sort -- to move to communities filled only with the kind of people they want to live around. That may lead to rich people avoiding the middle class, the middle class avoiding the poor and people segregating by race.

A third problem, of course, will be carbon. Making it more desirable and productive to drive long distances means that people will spend more time in vehicles, belching exhaust as they go. Cheap solar power and electric cars, of course, will reduce that problem, but there is no guarantee that cars will go electric by the time they go driverless.

A fourth problem will be the impact on public transportation. Driverless cars have all of the advantages of trains and buses, with few of the drawbacks, so their advent will undoubtedly reverse the recent increase in the use of mass transit. Train and bus companies have already paid large sunk costs to develop routes and stations. If people switch en masse to driverless cars, those sunk costs will sink the companies. Just as utilities are being disrupted by rooftop solar, transit companies will be disrupted by the driverless revolution.

You'll notice that all of these are basically continuations of problems we've already seen in the U. S. Cheap gas and a good highway system drove down the cost of individual transportation after World War II, leading to an exodus from the cities to the suburbs. Urban sprawl, white flight, income segregation, the decay of mass transit and a big carbon footprint have been the costs we have paid for that shift.

That doesn't mean it wasn't worth it. I doubt that if you took a vote, people would want to give up their cars. Nor should we try to stop or slow the arrival of driverless cars. The benefits are far too enormous. But we should definitely be preparing for the change, and anticipating the policy challenges that will come out of it.

Previously:
• 11/04/15 China's slump might be much worse than we thought
• 10/22/15 Get used to it: Low interest rates are here to stay
• 10/21/15 Who needs oil when you have a skiiled citizenry?
• 09/01/15 I erred. A national $15 minimum wage is a mistake to avoid. Here's why
• 01/28/15 Societal freedom brings riches: What too many miss

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Noah Smith is an assistant professor of finance at Stony Brook University.