Do Higher Speeds = Higher Incomes?

A new study published by the National Bureau of Economic Research (ungated copy) finds that, whaddyknow, faster urban speeds are associated with richer countries. The study looked at urban travel speeds in 1,200 cities around the world to “find that improved urban mobility is an important and previously undocumented feature of economic development.”

Important yes, but hardly previously undocumented, as researchers such as Rémy Prud’Homme in France and Sam Staley and Adrian Moore in the United States have looked at the relationship between travel speeds and economic productivity. That has also been a consistent theme of the Antiplanner, especially when comparing the ability of fast cars vs. slow transit to help people out of poverty.

Still, the new paper by researchers from Finland, Canada, and the United States relies on an impressive database and considered far more countries. Among other things, they find that speed differences are greater between countries than between cities within a country; that faster cities are faster because they have more roads and are lower in density (which they describe as have a “larger land area”); and that those roads produce benefits by allowing faster top speeds more than by reducing congestion.

The authors’ database revealed that 19 of the 20 and 86 of the 100 fastest cities in the world are all in the United States. The slowest city was Dhaka, Bangladesh. As I’ve noted here before, other than city-states like Singapore, Bangladesh is the only country in the world that doesn’t have lots of land available for (among other things) new roads and new housing. It is likely to remain poor until large numbers of its residents move to some other lower-density country.

The authors dismiss walking (and, by implication, bicycling) because these modes “cannot support the complex production networks and diversity of consumption amenities of modern cities.” They do look at transit, but only to note that transit in nearly 1,000 out of the 1,200 cities they studied didn’t have its own rights-of-way and so the best way to increase transit speeds was to build new roads that increased the speeds of all vehicles.

The paper was disappointing in a couple of ways. Most important, the authors assume that richer counters are faster because they are rich. They don’t consider the possibility that being faster helped them get rich. Research by Prod’homme and Staley both concluded that faster speeds were an essential part of increasing worker productivity. A few phrases in the new paper make me suspect that the authors wanted to explore that possibility but didn’t feel they had enough evidence to show it was true and so neglected it.

Related to this, the authors failed to compare the contribution of urban transit speeds to overall transportation speeds in cities that heavily relied on transit and where transit has its own rights of way. In cities like New York and London where transit accounts for a huge percentage of urban travel, does transit make that travel faster or is transit by its nature slower than in cities that rely more on auto travel? Work from the University of Minnesota Accessibility Observatory suggests the latter is true.

This is important because developing countries would want to know if they should build more roads or build more transit lines to boost their wealth and incomes. Of course, then the authors would have had to address the the relationship between such speeds and worker incomes.

The authors conclude that cities that want to increase speeds (and, by stated implication, worker incomes) should build more roads. While it admits that won’t be possible in Bangladesh, it should be possible in most cities and countries. Even if, as the anti-road people argue, building more roads simply leads to more driving, building roads that are faster leads to higher overall speeds which should produce enormous economic benefits.

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About The Antiplanner

The Antiplanner is a forester and economist with more than fifty years of experience critiquing government land-use and transportation plans.

4 Responses to Do Higher Speeds = Higher Incomes?

  1. LazyReader says:

    Is that functionally relevant, As Asian/European megacities have functional heavy duty transit systems. authors dismiss walking (and, by implication, bicycling) because these modes “cannot support the complex production networks and diversity of consumption amenities of modern cities.”

    This is also absurd because economic productivity in age digital and office work environments. Speed of personal movement is less relevant as long as said employees are On time.

    Transportation is certainly important for developing countries to economize. But more important factors like energy availability, access to key infrastructure namely internet and electricity. Hooking them to the electric grid, hell building one………will be far more gargantuan challenge.

  2. “Speed of personal movement is less relevant as long as said employees are On time.” Speed of personal movement is relevant to the people who are moving. Otherwise, we wouldn’t mind working 1,000 miles away from home. Speed is important because higher speeds give access to more jobs so people are more likely to find a job that fits them best and employers are more likely to find the employees that best meet their needs.

  3. duke the lost engine says:

    Bangladesh is actually building lots of new roads at the moment (as well as new metro lines). They are expressways above existing roads, it’s impressive what the fit into such tight corridors.

  4. LazyReader says:

    “Functional” speeds are are not quantitative. Major cities worldwide adapted their freeways or removed urban highways for boulevards and fewer lanes, despite this move as many vehicles. Urban speed limits average 25 mph. The average pedestrian struck by a driver traveling at 20 mph has a 93% chance of survival.
    Said person is about 70% more likely to be killed if they’re struck by a vehicle traveling at 30 mph versus 25 mph. Even modest increases in speed raise impact fatality exponentially. At 30 mph 1 in 5 pedestrians are killed.

    Speed limits WORK. If enforced properly. European Union is mandating autos in cities be equipped with electronic speed limiters to drive in city streets. Meanwhile the US will waste Tens of billions for millions of man-hours for half a million cops to enforce traffic for a fraction of the effectiveness.
    Slower speeds reduces stopping distances, making it easier for drivers to avoid hitting people in the first place.

    Reducing speed limits can in fact improve average traffic speed. Bottlenecks in the system are what reduce traffic flow and are usually caused by traffic entering the road network faster than traffic can get through it. This is why motorways in UK have adjustable speed limits on highways entering cities at busy times. It makes overall traffic move smoother.

    Between 2000 and 2016, the U.S. built an average of 30,000 lane miles of roadway per year. 480,000 miles of roads, traffic congestion grew not declined. But better traffic management, options of bikes/walking, Rise of Mopeds/scooters (Asian megacities and EUropes medieval streets) and variable transit vehicles (small buses/vans) move AS many/more people with Less financial public investments.

    Complex production networks Move valuable commodity.
    US has a busy freight rail and trucking system. Canada/Scandanavia are geographically constrained populations to it’s warmest regions creating urban density patterns that favor economic trade.

    Speed is not the same as mobility or accessability, nor the same as Logistics. Africa is poor for a lot of reasons….
    – Their Geography makes trade……..tenuous. Then again Ancient Rome built 2,100 miles of roads

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