Growing Wealthier
Smart Growth, Climate Change and Prosperity

Center for Clean Air Policy 2011
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Trends

Smart Growth, Driving and Economic Health

Transportation is vital to the production and exchange of goods and services. But in our transforming economy, economic activity can happen in myriad of ways; vehicles and people in motion are only a part of a much greater whole. Although vehicles miles traveled (VMT) rose along with gross domestic product for decades there is now evidence that the relationship is changing (Figure 3).

Historical Growth

According to U.S. Chamber of Commerce analysis, the importance of travel as a component of the economy has been declining since the early 1990s, and is expected to continue to decline through 2030 (Figure 4).

Travel Intensity of the US Economy

As VMT increases along with fuel and other vehicle costs, the hit to the household budget expands, so that today transportation and housing together take about half of every dollar earned. While vehicle travel per household increased by 70% from 1969 to 2001, incomes for 60% of American households increased only 18%. These Americans drove substantially more, but did not share proportionately in income growth (Figure 5).

CCAP has dubbed travel that contributes little or nothing to the economy “empty miles”. At the state level, we found a negative relationship between vehicle travel and productivity; that is, many states with higher VMT per capita actually performed worse economically that those with lower rates of driving (Figure 7).

Ten common-sense principles that many urban planners, public officials, real estate professionals, architects and designers subscribe to, can guide new development in ways that improve accessibility and alleviate many of the problems of sprawling land use, while enhancing quality of life. Three rigorous studies in the past few years found that communities following smart-growth strategies either have succeeded in, or have the potential to, reduce their citizens’ driving up to 60 percent. In Growing Wealthier we walk through each smart growth principle, identifying a variety of economic and prosperity benefits. Following are some key examples.

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