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Induced demand gets thrown around a lot, without understanding why it is invoked. Inducing demand can often be good. We build things so that we can use or sell

Induced demand gets thrown around a lot, without understanding why it is invoked. Inducing demand can often be good. We build things so that we can use or sell them. A railroad should induce new trips just as a highway should. The problem with highway expansion in 2024 in the US is that each new mile of highway gets ever increasingly more expensive and hard to build and produces diminishing returns, at high cost to the neighborhoods that will be bulldozed and divided. And these high costs are sucking the money away from not only the development of alternative modes which could be good backup options, but also the maintenance of the current network. It is not unheard of for a single highway interchange to now cost nearly $2B+: https://en.m.wikipedia.org/wiki/Zoo_Interchange https://en.m.wikipedia.org/wiki/Zoo_Interchange

seadan83 2y ago
> Inducing demand can often be good. I would quibble here, it depends. Another example I am thinking of is toilet paper during the pandemic when it was in short supply. At that time, when we were counting squares of toilet paper and predicting when you were going to run out, people used their toilet paper very efficiently. When it is plentiful, suddenly you don't care about using every last bit as efficiently as possible. In my previous example in the parent post, everyone is still making it to the grocery store and/or work, but it's a question of how efficient people are incentivized to be when making those trips. When it comes to highways, I'm guessing that it's more the case that inefficient/unnecessary trips become more economical than typically enabling people to make a given trip at all. I know a lot of people are pretty lazy about planning their trips, I'm guessing there are a lot more of those people than those that cannot go to a city because it requires 45 minutes instead of 30. Just my guess there though, and certainly that is context dependent. I like your points regarding efficiency of cost for expansion as well. Though, my point is more that induced demand is the minimum efficiency of a resource someone is willing to incur for it to be worth the cost of using that resource. That latter part, is a bit independent of the cost of building that resource in the first place, though that construction cost is still an important thing to consider.

seadan83 2y ago

> Inducing demand can often be good. I would quibble here, it depends. Another example I am thinking of is toilet paper during the pandemic when it was in short supply. At that time, when we were counting squares of toilet paper and predicting when you were going to run out, people used their toilet paper very efficiently. When it is plentiful, suddenly you don't care about using every last bit as efficiently as possible. In my previous example in the parent post, everyone is still making it to the grocery store and/or work, but it's a question of how efficient people are incentivized to be when making those trips. When it comes to highways, I'm guessing that it's more the case that inefficient/unnecessary trips become more economical than typically enabling people to make a given trip at all. I know a lot of people are pretty lazy about planning their trips, I'm guessing there are a lot more of those people than those that cannot go to a city because it requires 45 minutes instead of 30. Just my guess there though, and certainly that is context dependent. I like your points regarding efficiency of cost for expansion as well. Though, my point is more that induced demand is the minimum efficiency of a resource someone is willing to incur for it to be worth the cost of using that resource. That latter part, is a bit independent of the cost of building that resource in the first place, though that construction cost is still an important thing to consider.