Self-Driving Trucks Will Create a Megaregion Economic Boom

Self-Driving Trucks Will Create a Megaregion Economic Boom

Brian Wang |
March 17, 2021 |

Urban areas are richer and more productive. Research shows that doubling the population and increasing urban density boosts productivity by about 15%. Roman cities were connected by the distance someone could walk in one hour. Self-driving cars, trucks and buses will be able to eliminate traffic jams and then have steadily increasing safe operating speeds. The German Autobon has safe operation with people allowed to drive at any speed they feel is safe. This ends up grouping drivers into 80 mph, 100 mph and 120 mph groups. Self-driving vehicles and having some dedicated roads and highways would enable rapid deployment of fast inter-region logistics. This would be deployed far faster than the decades China has used for high-speed rail connections between and in large cities.

Self-driving trucks and cars with higher speed and no traffic jams will increase the population within one hour travel that can closely interact. This forecasted economic boom does not initially involve moving anyone from where they currently live or work. There could be later urban evolution where regions are reshaped to more effectively take advantage of transportation changes. The volume of business and speed of business will increase as the supply chain is sped up and regional interactions and transactions increase. All vision automation can be a few hundred dollars or less allowing for ground automation of Curiosity Rover sized vehicles or even smaller. I think ground delivery will have lower cost most of the time compared to drones. flying drones will have a niche for difficult terrain (many steps, hills, etc..).

The ways in which density is linked to productivity has been developed in a wide array of research projects. Six key impacts are discussed in this section:

* density allows a higher degree of specialization, increasing efficiency;

* reduced transport time and costs for products/goods/services from one stage to the next, or from producer to consumer, occurs in denser areas if the transport infrastructure is sufficient;

* increased density increases the prevalence of knowledge spillovers, increasing innovation

* density allows firms to have access to larger markets of suppliers (especially labor supply) and consumers, allowing competition to enhance the quality of inputs and outputs;

* efficiencies of scale are created in denser markets where suppliers are reaching more potential customers;

* reduced land take in denser areas allows more economic activity to take place on a fixed piece of land than less dense designs.

Dan Graham (2005b, 2006) examined the relationship between increased effective density (which takes into account time traveled between business units) and increased productivity across different industries. Graham found economy-wide urbanization elasticity (that is, the response of productivity to changes in density) is 0.125. This means that a 10% increase in effective density, holding all other factors constant, is associated with a 1.25% increase in productivity for firms in that area. Doubling the density of an area would result in a 12.5% increase in productivity. Others have noted a 15% increase in productivity from a doubling of a population within an area.

There are megaregions in the US, Europe, China and rest of the World. The regions tend to be 80 to 250 miles across.

There are about 60 million people in the North-Eastern USA (Boston, New York, DC regions). Instead of this being a loosely connected cluster of 4 metro-areas self-driving trucks could integrate the region. This would be a quadrupling of connected people and potentially a 25-30% boost in per capita productivity.

The top 29 global megaregions generate $29 trillion in GDP. If connectedness was boosted with self-driving vehicles for a 25-30% boost in productivity for all megaregions this would be a global boost of $8-10 trillion. Boosting the entire global economy ($130 trillion) would add $30-40 trillion. Some megaregions are relatively close, so there is the potential for larger population integrations. China has about 250 million people in the cities around Shanghai. This is a three doubling integration.

In the USA, the northeast megaregion is close to the Great Lakes region and the Toronto-Buffalo cluster. If all three could be more tightly integrated this would be boosting the productivity of 130 million people.

SOURCES – Visual Capitalist, Wikipedia

Written By Brian Wang,

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