How Will Driverless Cars Shape Our Economy?

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Autonomous cars were relegated to science fiction until fairly recently. Today, the implementation timetable for driverless cars is shrinking as companies race to beat the competition. Research into driverless cars is popping up in Columbus, Bloomington and at IUPUI's Transportation Active Safety Institute, where students are literally test driving the potential for driverless cars and analyzing the opportunities and challenges this fledgling technology creates for the automotive industry and the community.

Still, how close are autonomous cars to becoming reality? Features of autonomous cars are already commonplace. Some cars can self-park; others won’t let drivers change lanes if an oncoming car is too close. Still others use adaptive cruise control that changes the speed of a car to match the car in front of it.

The technology is developing so rapidly that state legislatures all over the country are considering laws to regulate autonomous cars. Nevada was the first state to authorize the operation of autonomous vehicles in 2011. Since then, 20 other states have passed legislation related to the self-driving vehicles, according to the National Conference of State Legislatures.

There will always be pros and cons to the unintended consequences of technological advancements.

Here are few things to consider as we look at the impact self-driving cars will have on our economy and daily lives:

Commutes and productivity. Productivity will increase because traffic flow will be faster and smoother during rush hour. The roads will be effectively clear of accidents, as autonomous vehicles will “talk” to each other to avoid collisions.

Savings. Most autonomous cars will be electric and use less fuel. These cars will be lighter and could travel greater distances without much downtime for maintenance.

Improved elderly/disabled mobility. Millions of people in this country do not drive because of age-related issues or a disability. Think of what a life changer it would be if autonomous vehicles could transport people who cannot drive or take public transportation.

Space. People may migrate back to cities that feature newly open vistas no longer congested with parked cars. Conversely, people could move out of cities and into rural areas if their commutes are quick, efficient and productive.

Jobs. Some jobs, such as truck driver and taxi driver, could eventually go away. Other jobs, such as high-skilled mechanics and data mining and security experts, could become more plentiful.

Cost of goods. Lower transportation costs and more efficient deliveries could mean lower costs for goods.

Safety. Accidents should drop significantly, because distracted driving and driver errors will no longer cause crashes. This can impact everything from insurance rates to auto body shops and personal injury lawyers. Most experts say driverless cars have the potential to save tens of thousands of lives in the U.S. each year, and millions worldwide.

Passive income. We may earn extra income by having our autonomous cars run errands for people or drive them around while we’re at work.

We can’t conceive of all of the possibilities now, just as no one likely envisioned pizza delivery jobs back in the days of the horse and carriage. A society dependent on autonomous cars is coming and getting closer to reality.  The one certainty about the technology is it’s going to sneak up sooner than we think.

Mekael Teshome is an economist with PNC.

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