The Next Big Economic Boost: Driverless Cars
Posted at 9:15 a.m. on Oct. 24, 2012
The Economist looks at the emergence of driverless cars as possibly a huge boon to the economy in the medium-term.
“It could, for a start, save the motor industry from stagnation… Yet automated cars would drive nose-to-tail, increasing the capacity of existing roads; and since they would be able to drop off their passengers and drive away, the lack of parking spaces in town might not matter so much… But cars that are driverless may not need steering wheels, pedals and other manual controls; and, being virtually crashless (most road accidents are due to human error), their bodies could be made much lighter. So makers would be able to turn out new models quicker and at lower cost.”
“Electronics and software firms will be among the winners: besides providing all the sensors and computing power that self-driving cars will need, they will enjoy strong demand for in-car entertainment systems… Bus companies might run convoys of self-piloting coaches down the motorways, providing competition for intercity railways. Travelling salesmen might prefer to journey from city to city overnight in driverless Winnebagos packed with creature comforts.”
Reihan Salam: “I also found the notion that self-driving cars might facilitate labor force participation for primary caregivers very interesting. We tend to focus on things like marginal tax rates, but self-driving cars could greatly increase market production by secondary earners and thus increase output. This is yet another reason we should prioritize the building of infrastructure for self-driving cars over high-speed rail, which wouldn’t have nearly as big an effect on the labor market.”