Monday, April 18, 2011

High Oil Prices and Land Use

In the April 18 edition of The New Yorker James Surowiecki has a piece about the economic - and psychological - impact of the recent rise in gas prices.

High oil prices are generally bad for the U.S.—oil spending goes largely to foreign producers, leaving less money for American goods and services—but if you look just at the dollars involved the terror they inspire is somewhat mysterious. Gas is a relatively small percentage of most household budgets, and prices are now about eighty-five cents a gallon higher than they were twelve months ago, which translates into a few hundred dollars more a year. That’s not trivial, particularly for lower-income Americans, but it’s not devastating. In fact, it’s less than the increase in income that most Americans will get this year as a result of the new payroll-tax cut...

And Carol Graham and Soumya Chattopadhyay, of the Brookings Institution, have shown that rising gas prices can have a significant impact on Americans’ level of happiness. In part, this is because most people, at least in the short run, have no choice but to fill their tanks. Gas prices are also literally the most visible prices we have; you can’t take a drive without seeing huge signs reminding you how much gas costs. Dan Ariely, a behavioral economist at Duke, has even argued that the way we buy gasoline—standing at the pump and watching the dollars pile up—is inherently disheartening.

What Surowiecki doesn't mention, suprisingly, is why people feel they have little choice but to fill their tanks.  You can all say it together with me, "It's because of sprawl!"  Autocentric land use patterns are hard on the pocket-book and the psyche.  I improved my personal happiness by riding my bike to work today.

Jamie Baker Roskie

Community Design, Development, Sprawl | Permalink

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