Stuck in Traffic.

• Author: Richardson, Craig

Almost all of us have been in frustrating traffic jams at one time or another; indeed, many of us experience it at some level every day. This well-organized book explains the reasons for traffic congestion, and carefully evaluates various strategies for reducing it, from an economist's viewpoint. After outlining the basic problems in Part 1, Downs examines strategies from a supply-side approach (Part 2) and then a demand-side approach (Parts 3 and 4). Part 5 presents his conclusions, and favored approach for reducing congestion, which not surprisingly, relies on market incentives.

As Downs points out in Part 1, traffic congestion arises because of market failure--automobile drivers do not face the true social cost of their private decisions about where and when to travel. A driver entering a congested freeway imposes costs on others by further slowing traffic down, but this driver does not directly pay the cost. Consequently, the average cost of the driver's "arrival" exceeds the average benefit of using the road. Like other externality problems, people drive more than they would if they bore all the costs of driving, resulting in an inefficient outcome, from society's point of view.

Statistics used in the book illustrate the problem well. Despite the fact that more people complain about congestion than in the past, since 1977 the number of miles travelled by all vehicles jumped by 61.9 percent, but the number of highway mileage increased by only 0.6 percent, and urban mileage by only 20.7 percent. Since the typical American is highly attached to commuting in his or her own vehicle, and desires to live and work in low population-density areas, congestion is a problem that will not be solved anytime soon. Americans rely on cars more than ever, and public transit usage actually declined between 1977 and 1983.

The supply-side approach, as in building more roads and infrastructure, is politically popular, because politicians can point to something tangible accomplished with tax dollars, and taxpayers do not have to modify behaviors. Unfortunately, building roads does not alleviate congestion for long. Any time a road opens up free of congestion, this lowers the cost of driving on that road. Predictably, more people will drive on it, switching from secondary roads, public transit, or leaving during rush hour instead of avoiding it. In a short period of time, the new road will be just as congested as the alternatives. Downs refers to this as...