Economic and behavioral effects of transportation infrastructure

Testimony to the New Jersey Clean Air CouncilApril 14, 2010

Robert B. NolandProfessor, Rutgers University, Bloustein School of

Planning and Public PolicyDirector, Alan M. Voorhees Transportation Center

Major issues• How does funding of transportation

infrastructure affect air quality and greenhouse gas emissions?

• How do people respond to changes in transportation infrastructure?

• What are the effects of transportation infrastructure on economic productivity and development?

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Transportation funding objectives

• Reduce congestion

• Increase economic development

3

Do expanded roads reduce congestion?

• When the cost of travel is reduced, economic theory suggests that…– Travelers choose to move to their preferred travel

time and route – peak congestion stays the same– New trips not previously taken are generated– Longer trips are made– People use their car instead of public transit– New land is opened to development, leading to

more and longer car trips

4

5

Elastic Demand & Supply

Quantity of Travel (VMT)

D1: Demand before

S1: Supply before

S2: Supply after

Q1

P1

Pri

ce o

f T

rave

l

P3

Q3

D3: Exogenous Demand growth

Q2

P2

Empirical studies confirm theory

• A wide range of empirical research studies confirm that new roads spur increased car travel

• But are roads built because planners foresee demand?– Research evidence suggests that expanded roads cause

growth in car travel

• In the long run, new and expanded roads will not reduce congestion– Transportation models do not fully capture these effects

6Noland, R.B. & Lem, L.L. 2002, "A review of the evidence for induced travel and changes in transportation and environmental policy in the US and the UK", Transportation Research Part D, vol. 7, no. 1, pp. 1-26.

What about vehicle emissions?

• Improving traffic flow can reduce emissions from cars

• But this effect does not last

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Break-even point for NOx

50

60

70

80

90

100

110

120

130

4800 5000 5200 5400 5600 5800 6000

Traffic Flow (veh/h)

Em

issi

ons

of N

Ox

(Kg)

Induced trips-mix Induced trips-all coldstarts

96.6 kg

5575 5702

Initial level of emissions

11.5% more cars 14% more cars

After adding lane

Noland, R.B. & Quddus, M.A. 2006, "Flow improvements and vehicle emissions: Effects of trip generation and emission control technology", Transportation Research Part D, vol. 11, no. 1, pp. 1-14

There are benefits to more traffic

• Allows more people to travel when and where they want– This increased mobility increases consumer

welfare– However, identifying the benefits depends on the

evaluation method used– Methods used by transportation planners tend

not to capture the long-term distributional effects

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10

Distribution of Benefits from Accessibility Increases

Cos

t of

land

Travel time

Before capacity addition

Initial land price

response

Land prices after

increase in

available supply

What are long run costs and benefits?• Benefits

– Allows more land to be developed, benefiting those who own land that is now more accessible

– Can allow an increase in supply of housing and commercial development, lowering costs to consumers

• Costs– Developments are more car-dependent and thus

emissions increase– Environmental costs associated with sprawl

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Can transportation funding and policy support environmental goals?

• Change incentive structure– Funding of roads versus public transit– Change mix of user fees for both roads and public

transit

• Development patterns make a difference– Focus new development on areas that are transit

accessible– This can provide options for people to avoid using

motor vehicles

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