Are driverless cars coming?

This alarm clock would be a real incentive to get out of bed (albeit shredding notes is illegal). From Mashable - h/t Alex Tabarrok

There are nine completely driverless train systems/lines operating in Europe, eight in Asia and six elsewhere. There are a further nineteen in Europe with a “standby driver” or, like London’s Docklands Light Railway, with a “Passenger Service Agent” present on the train, just in case something goes wrong.

So Google’s claim that its seven driverless test cars have driven 1,000 miles on roads without human intervention and more than 140,000 miles with only occasional human control sounds plausible. The company is reported by the New York Times as saying one car drove itself down Lombard Street, one of the steepest and curviest streets in San Francisco. 

According to the paper, Google’s engineers say “robot drivers” are better because they:

React faster than humans, have 360-degree perception and do not get distracted, sleepy or intoxicated……They speak in terms of lives saved and injuries avoided — more than 37,000 people died in car accidents in the United States in 2008. The engineers say the technology could double the capacity of roads by allowing cars to drive more safely while closer together.

Although they are some years away yet, the claimed potential benefits of this new technology are enormous. If proven, it should allow travellers to do other things while driving, making time spent travelling much more productive. On roads where conventional vehicles have been superseded, road capacity should at least double, although according to some observers an eight-fold increase can easily be achieved. Speeds should increase while simultaneously reducing road accidents — one of the largest negative externalities associated with roads — through keeping drunk drivers away from the wheel and minimising simple driver error. If accidents are less likely, vehicles can be made lighter and therefore use less fuel.

If it can be implemented without the need for a “standby driver”, there is scope to lower taxi and freight costs substantially. In the latter case this should help make smaller trucks viable, reducing the need for very large trucks within urban areas. However the natural extension of eliminating the need for drivers is to remove the requirement to own cars altogether. If all the functionality of a private car is still possible – like on-demand availability, privacy, point-to-point travel – then the warrant for owning a dedicated vehicle is greatly reduced.

Huge benefits would follow if sharing could be made to work because rather than being parked for 98% of the day, vehicles could be out earning their keep 24/7. The size of the city’s car fleet would be greatly reduced and the cars themselves could be much smaller and lighter – for example, a majority could be single seaters to reflect demand patterns. In time, it’s likely the cost of travel attributable to vehicle ownership and fuel costs would fall significantly as economies of scale were achieved. People on lower incomes or unable to drive would get a big improvement in mobility. Travellers would ‘pay per kilometre’, making them more sensitive to travel costs.  Read the rest of this entry »

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Why do bankers make $squillions (and you don’t)?

Road pricing in London in the 18th century

There’s an interesting discussion going on in the blogosphere right now about how Wall St made and lost so much money in the noughties.

It started yesterday our time when George Mason University economist and ‘the world’s most read economics blogger’, Tyler Cowen, announced that he’d written an essay on inequality in The American Interest.

He makes some interesting points – for example, Americans are more likely to be envious of their better paid colleague or their slightly wealthier brother in law than they are of billionaires and financial high rollers. Nevertheless, he focuses on “the pernicious role that big finance plays in modern political economy”.

As I interpret it, his thesis is that the finance sector takes big but self-enriching risks in the good times because it relies on government bailing it out on the odd occasion when real disaster strikes. As Ross Douthat from the New York Times puts it:

The “bust” part of the cycle tends to make taxpayers suffer more than the Wall Street investors themselves, thus incentivizing further recklessness and still worse crack-ups down the road

By this morning (Thursday), the debate has been joined by an army of influential pundits, including Ross Douthat, Ryan Avent from The Economist, Kevin Drum from Mother Jones and political blogger Matthew Yglesias. By the time you read this it is likely there will be many more. Read the rest of this entry »