The Mobility-Productivity Paradox: Exploring the Negative Relationships Between Mobility and Economic Productivity

Abstract

This paper explores a paradox: negative correlations between indicators of mobility (such as VMT) and productivity (such as GDP), and positive correlations between mobility constraints (higher road use prices or traffic congestion) and productivity. These relationships contradict common assumptions that policies and projects that increase vehicle travel (roadway expansions and lower road user prices) increase productivity and support economic development. This paradox can be explained by the following: First, motor vehicle travel is just one of many factors affecting overall accessibility, and planning decisions often involve trade-offs between mobility and other accessibility factors such as the quality of other modes and land use accessibility. Second, many policies that increase mobility violate efficient market principles, which tends to reduce productivity. Third, motor vehicle travel is resource intensive, so increases in such travel increase various costs, including costs borne by industry. Fourth, increased vehicle travel increases the portion of household budgets devoted to vehicles and fuel, expenditures that generate low regional employment and business activity. This paper examines these issues, describes empirical evidence of these impacts, and discusses their implications.

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