Transportation economics is flawed

The “time is money” mantra is a terrible starting point for planning and designing infrastructure.

Bad math leads to bad design

Productivity, and alleged lost productivity, has driven most of the conversation around traffic congestion and sprawl in the United States. While “time is money” is true in some contexts, it’s a terrible starting point for planning transportation systems.

Traffic congestion is a pervasive issue, whether it’s the destination (a downtown, a stadium, a new development) or the streets connecting to the destinations. In economic terms, congestion occurs when demand exceeds supply: not enough lanes for everyone trying to get somewhere at once. Your time is valuable and there are sometimes real consequences you experience when roads are clogged with cars. But it’s a serious mistake to overplay the economic claims.

Researchers tend to analyze traffic with the assumption that the “time is money” framework is completely valid. News outlets love it too because it produces reliable doom and gloom for clicks and views:

• Traffic congestion cost the US economy $74 billion in lost time last year.

• Drivers lost 102 hours stuck in traffic last year.

• The average American driver lost $771 in productivity sitting in traffic last year.

Of course, an industry that plans, engineers, and builds roads is eager to argue we need more roads. But the impulse to attach dollar values to time isn’t just self-serving industry spin. The World Economic Forum uses the same standard economic framework to justify transit lanes and bike lanes. Residents of cities and suburbs do benefit from multimodal infrastructure, but the economic framing around productivity is weak.

Economists treat humans as if we’re rational creatures who make decisions that can be predicted with basic math. An economist won’t calculate time with family, the choice to spend an extra hour at trivia night, homemade bread, journaling, or band practice. There isn’t a formula for why we make certain choices that lead to a higher quality of life. The productivity pressure that results creates fertile ground for anxiety, depression, and burnout. There’s a constant expectation to be “on,” connected, producing. Admitting you need a break reads as weakness. Too much productivity, paradoxically, undermines everything productivity promises. It’s not my musical genre, but I’m sure there’s a country song about a guy who tried so hard that he died too soon.

Corporate HR departments tend to understand that a “machine” running without maintenance breaks down. They track the turnover, the disengagement, and the burnout. The human body and mind require regular maintenance: socializing, resting, walking with no particular destination, writing music, taking pictures, shooting hoops, and so on.

Public agencies are perpetually strapped for cash, but they continue spending depleted budgets on congestion relief that doesn’t work. Be deeply skeptical of any report on the economic costs of congestion because those studies reliably reduce humans to soulless economic units.

The same principle that makes road expansions fail — induced demand — explains why building for people works. Design for human flourishing and you’ll induce more of it. Build more lanes to make car travel easy, and you’ll get more car trips. Redesign a street network to make cycling easy, and you’ll get more bike trips.

Building a human-scale city means working towards outcomes that don’t show up on a productivity dashboard.