Until recently, autonomous cars have seemed silly and unrealistic. However, the technology for autonomous cars has already begun to be implemented, and just last month Uber introduced a fleet of autonomous cars to the city of Pittsburgh. Google, Mercedes, Tesla and more are all working on autonomous technologies that are scheduled to be introduced within the next few years. Self-driving technologies will have a tremendous impact on our economy when they are introduced. Driving will no longer be a time consuming task which forces the driver to be almost as unproductive as being stationary. Because there would no longer be a need to focus on controlling the car, passengers would be free to use that time as they choose.
Another benefit will likely be a more efficient use of automobiles in general. On average, Americans spend only 101 minutes driving which leaves the rest of the day for the car to be stationary, unproductive, and taking up space. Autonomous cars could potentially change that thanks to ridesharing systems similar to Uber and Lyft. Why have your car stationary while you’re at work if it could be generating revenue driving others at a rate you set? Delivery services will also be greatly affected. An autonomous car has no need for sleep, food, restroom stops, etc., which decreases the time and cost of transporting goods. Autonomous cars will end up having a huge positive effect on the economy and will likely drastically reduce the cost of transportation.
An obvious objection that has already been raised against self-driving cars is that it will cause unemployment. This objection is not new and is heard whenever a new technology is able to do work more efficiently than a person. Henry Hazlitt countered this objection in his book Economics in One Lesson.
The belief that machines cause unemployment, when held with any logical consistency, leads to preposterous conclusions. Not only must we be causing unemployment with every technological improvement we make today, but primitive man must have started causing it with the first efforts he made to save himself from needless toil and sweat.
The transportation revolution will likely render many individuals, whose livelihoods depend on driving, temporarily unemployed. However, this pattern of technology temporarily displacing people has been observed throughout history and has lead to increased productivity — and thus, higher real wages — in every case. New technologies allow people to spend less money on certain products or services (in this case transportation) and allow them to spend their money elsewhere providing opportunities for new areas of employment. Ultimately those who are displaced by new technologies are allowed to find new more productive work.
Implications of Autonomous Cars for the Larger Economy
Privatization of roads would have seen an earlier implementation of these technologies as roads would have been able to implement technologies that would assist autonomous cars. Makers of self-driving software could have implemented autonomous enabled intersections that would have been able to communicate with autonomous cars making their feasibility that much more realistic. In fact some of the troubles that come with programming an autonomous vehicle have to do with the current designs of the road. Currently if an Autopilot Tesla car does not identify the lane markings, it will be unable to operate in autopilot mode. The result of this is much of the design of autonomous vehicles is actually focused on overcoming the design of the roads themselves and their inherent hostility toward autonomous vehicles. Despite these setbacks, autonomous cars will make the State increasingly irrelevant when it comes to regulating the rules of the roads. One example of this is laws dictating who can drive. Eventually, laws dictating who can drive a car will be made irrelevant with autonomous vehicles. There is no such thing as drunk driving if there is no driving involved. Laws regarding disabilities such as blindness and age restrictions on driving are also made irrelevant. No driver means no need to obtain a driver’s license to operate a car and a driver’s license would therefore be irrelevant. Public transportation will be irrelevant as ride sharing becomes cheaper and cars are used more productively. As autonomous vehicles improve, they also have the possibility to make roads much safer.
In the United States alone, over 37,000 people die on the roads each year and worldwide the number of deaths amounts to 1.3 million. Privatizing roads would be a step in the right direction for increasing safety, however, autonomous cars may be helpful in this regard as well. Road rage, drunk driving, distracted driving, etc., do not exist when there is a program paying attention to the road at all times and in all directions.
Currently car accidents are estimated to end up costing $164.2 billion each year in the US alone. If driverless technology can be perfected to the point it leads to fewer accidents, more of this money and resources will be allowed to focus on other areas of the economy. Companies that make autonomous vehicles also have an incentive to make sure their cars are as safe as possible for the passengers, other drivers, and pedestrians. As fewer cars are in accidents, prices of insurance will likely drop decreasing the burden and therefore the relevance of mandatory vehicle insurance. More autonomous cars also has the power to diminish traffic for two main reasons:
- Autonomous cars would communicate with each other and have their actions planned ahead of time to avoid traffic. They will also be able to coordinate with each other in order to, for example, accelerate simultaneously thus almost eliminating traffic due to congestion. This goes in tandem with software manufacturer’s incentive to create systems with minimal traffic.
- People and companies who own autonomous cars can charge higher rates for ride sharing at times of high congestion such as rush hour.
Instead of waiting for the State to come up with ways to try and reduce traffic, the market may already have found the solution.
Giuliano Millan is a computer engineering major attending Cal Poly Pomona.
