Mobility Matters Daily #75 - Gentrification, cryptocurrencies, and biofuels
Read on to learn about how commuting time affects gentrification, how cryptocurrencies are gaining a foothold in transport, and how biofuels are not evil
Gentrification may have a simple transport-related cause, which COVID may have disrupted
People don’t like to travel far, a fact known by transport economists the world over. But recent economic analysis studying data going back to 1990 indicates that higher earners, who work longer hours, may be gentrifying areas near city centres because they want to spend less time commuting, and more time working. In contrast, lower wage workers work fewer hours, and their commuting times grew faster than high wage workers.
COVID-19, meanwhile, has meant that more high income workers are working from home. They are also more likely to continue to do so once the pandemic ends. Which then poses a question. How will gentrification change resulting from this? There is plenty of speculation, such as people moving away from cities into rural areas, but not much by way of evidence, even from stated preference surveys.
Transport and cryptocurrencies may soon be a discussion we cannot avoid.
A spoiler warning: this will be talking about him again. Elon Musk and Tesla recently caused some consternation in the cryptocurrency community by buying Bitcoin, accepting payments for new Telsa’s using Bitcoin, jumping the price of Bitcoin, selling part of their holdings, and then saying they will no longer accept Bitcoin payments. These views range from it being seen as a get-rich quick scheme, to politics, to calling Musk a “self-absorbed grifter.” But maybe transport should start taking cryptocurrencies more seriously. (If you have no idea what a cryptocurrency is, here is a little primer).
Being what is essentially a form of payment, whilst it is still a marginal interest, offering to pay using a cryptocurrency may soon become a way to pay for transport. Indeed, in countries with more unstable currencies, Bitcoin is already being used to pay for freight transport. In Argentina, 37 cities now accept Bitcoin as payment for using public transport services. At what point does it become interesting? When it starts being offered across more platforms and services. Remember, PayPal started out from small beginnings.
Biofuels may not be the evil that is so-often stated
The last 10 years has not been kind to biofuels. To state but a few of the negative environmental impacts of the use of biofuels, these are poorer air quality, habitat loss, threatening water quality, and it plays a role in increasing food prices. Despite a significant roll-out of biofuels as a technology, the environmental chorus surrounding the adoption of biofuels in the transport industry has grown.
This is what makes a recent paper in the Review of Environmental Economics and Policy interesting. What economic modelling has shown is that the impact of biofuels on food prices has been offset by increased crop yields, and reduced the price of fossil fuels. In addition to being less carbon-intensive than gasoline. A fact confirmed in another study focussing on carbon emissions from biofuel adoption. This is not to say biofuels are the saviour, but perhaps they have been misunderstood for too long.