Driverless cars are coming! And along with robot drivers, a lot will change in American culture. One aspect that will change, that I think is underappreciated, is that there will be many more people alive. And it turns out people being alive is enormously beneficial to the overall economy!
Roads are insanely dangerous
I am constantly amazed at how invisible the dangers of driving are in American culture. In fact, for most jobs, the risk of dying on-the-job is fully explained by the time spent driving. That’s why truck driving is one of the most dangerous jobs in the world. For example, most people understand that being a police officer is dangerous, but they may not fully understand why. Interestingly, cops are actually equally likely to die in a vehicle accident than in a shooting.
Based on data from the National Law Enforcement Officers Memorial Fund, in 2018 (the most recent year available), 536 officers died in automobile accidents, bicycle accidents, motorcycle crashes, struck by train, or “struck by vehicle”. In the same year, 528 officers died in shootings. In other words, about half of the risk of the job of the police is due to driving and/or being on the road with other drivers so frequently!
This actually creates the potential for an economic windfall
Apart from the personal and societal tragedies of 106 people dying per day in car accidents, there is also a huge economic toll to car crashes. American GDP is one way to think about this. Every year, the American economy generates $62,800 in economic activity per person. That means every day, $6.7 million of annual economic activity is lost on the road due to road deaths. That’s $2.3 billion annually. And this compounds over time, because that economic activity is lost forever, and then the next year, a whole new $2.3 billion is lost.
And that’s just a fraction of the economic harm that human drivers are doing to the national economy. The CDC estimates that when you factor in medical care and productivity losses from non-fatal accidents, the economic harm of car crashes comes to $75 billion annually*. With US GDP currently at $21.43 trillion, getting rid of the economic drain of vehicle crashes would be enough to cause a 0.3% bump in GDP growth.
So apart from the technological marvel of driverless cars, we should also be exited that having all of these extra living people around will be great for the economy!
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*Yeah, I know that the medical expenses are also economic activity. Still though.