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That one article/chart is not as a definitive illustration of "induced demand" as many people seem to think it is.
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Disclaimers:

  1. Quantity demanded of roadway travel absolutely does increase in response to increases of supply, see duranton and turner, not this article/chart.

  2. The fact that quantity demanded increases in response to an increase in Supply tells us ~0.00000000000% about how much of anything to supply.

  3. The pre-expansion Katy was an absolute clusterfuck where it took at least 60 minutes to drive this stretch either direction between 4am and 11pm, the rush "hours" were 4 hours long and the travel time was more like at least 90 minutes (I called transtar and asked for the historic data, when this article first came out but they didn't have this far back).

  4. The constant citation of this article makes me so incredibly irrationally angry because it is so meaningless.

The City Observatory article/chart in question, on the expansion of the Katy Freeway in Houston, TX defines

induced demand: adding more freeway capacity in urban areas just generates additional driving, longer trips and more sprawl; and new lanes are jammed to capacity almost as soon as theyโ€™re open.

Then believe they illustrate it by showing a chart with increasing congestion from 2011 through 2014. So we must have seen the increase in capacity somewhere in that timespan, right? Oops, work was completed in October 2008. I guess if people want to keep believing it is so definitive they must believe that the completion of the expansion in 2008 led to the ~$100/bbl oil prices in 2011-2014 and the establishment of Houston, TX as the global Oil & Gas headquarters in ~1970. Because what we do know is that those two last things led Houston to adding 100,000 jobs per year during this time span (the energy corridor was also already along the Katy pre-expansion and was going to be the focus of this employment growth either way).

Now sure, the lower price/cost of travel on the expanded Katy Freeway led to a higher percentage of Houston's population and employment growth to be located along the western corridor which certainly was leading to congestion to grow in and of itself. But, that pails in comparison to the absolute increase in population and employment Houston saw over this time period.

TL;DR, Congestion growing over time in a growing city doesn't prove that an increase in Supply leads to an increase in quantity demanded.

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A new Church's Chicken != Economic Development

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3 years ago