Monday 17 December 2012

Car ownership is falling in London but car traffic is falling even faster

The last couple of weeks have seen some interesting figures confirming the decline of car culture in London. First, the 2011 Census results showed, as summarised by London City Cyclists, that the number of car-free households is growing across Inner London. Then the National Travel Survey showed that car travel per person in London fell 22% in just seven years (table NTS9904 here). Finally, as pointed out by Angus Hewlett on Twitter, here's a survey (admittedly from a fortnight ago) showing that "One in seven Britons said they were part of a household which owned a car that was only used occasionally", a figure that rose to one in five in London.

That survey suggests that car ownership has some way to fall yet in London. To get a better sense of this I plotted the trend in distance travelled by car (from DfT table TRA8905a) against the trend in the number of cars (from table VEH0204) for London and England as a whole in the chart below. Both series are rebased to start at 100 in 2000.

What this shows is that in England as whole the number of cars has risen 15% since 2000 and the distance travelled by car just 2%, while in the Greater London area the number of cars has risen 5% but the distance travelled by car has fallen 13%. The leftward turn in both lines is an indicator that distance driven per car is falling in both London and England, but it's falling particularly fast in London, in fact by 15% since 2000. The average car in London drives around 9,100 km per year (down from around 11,000 in 2000), compared to 13,800 km a year for the average car in England as a whole (also down, from 15,400 in 2000).

So it's no surprise that there are lots of 'ghost cars' hardly being driven in London, or that, particularly in the last few years, many Londoners are deciding that it's just not worth the cost and hassle of owning one. I'd expect this trend to continue for some time yet and the number of cars in London to shrink further (though it is worth bearing in mind that across London as a whole there are more cars than there were in 2000). I just hope we use the extra space freed up for useful things rather than just dropping the cost of parking even further.

Tuesday 11 December 2012

What do homeowners have a stake in?

Today's Census figures showing a fall in home ownership have excited plenty of comment about the struggles of so many people to get on the property ladder. With excellent timing, the IPPR came out with some research yesterday examining some of the knock-on effects of these housing pressures. Jenny Pennington, the author of the research, summarises the argument here. I recommend people read the full report as it has some really good qualitative evidence on the social consequences of high housing costs, such as people having to delay starting relationships or having children. But there's one particular result I'd like to focus on. Jenny writes:
Secure housing also makes a real difference to the way people invest in a particular community. Owning a home increases a person's sense of belonging to a neighbourhood. For example, an individual who has lived in the same home for 20 years without owning it is likely to feel the same sense of neighbourhood belonging as someone who owns their home, but has lived in it for just six years. Young people who did not own their home talked about not really seeing the point of committing to the area in which they lived or getting to know the people they shared a street with.
This conclusion is arrived at through a robust-looking analysis of survey data, and I'm sure it's accurate as far as it goes. I would just caution that it's very hard to control for all the relevant factors here, particularly the crucial one of how long people intend to stay in a neighbourhood. Someone who expects to be moving on in a few years is likely to be less keen to either buy a home (given the transaction costs involved) or get much involved in local community matters. If the average level of 'expected mobility' in the population rose (because more people need to move to find work, for example), then we should probably expect to see both less home ownership and less 'neighbourhood belonging' - but home ownership wouldn't be the causal factor.

That said, I suspect there probably is a positive effect of homeownership on community belonging, even if it is hard to identify empirically. Pure self-interest would suggest that homeowners are likely to be more committed to the improvement of their area, because when you own a home somewhere you are to some extent stuck there (transaction costs again), and the value of your (very large) financial investment will be determined by what does or doesn't happen in its surroundings.

Lest anyone think I'm just being cynical for the sake of it, there is some pretty good evidence that homeowners' attitudes towards community issues are influenced by the expected impacts on house prices. Here's Christian Hilber, writing in the Journal of Urban Economics in 2010:
This paper examines the role of local housing supply conditions for social capital investment. Using an instrumental variables approach and data from the Social Capital Community Benchmark Survey, it is documented that the positive link between homeownership and individual social capital investment is largely confined to more built-up neighborhoods (with more inelastic supply of new housing). The empirical findings provide support for the proposition that in these localities house price capitalization provides additional incentives for homeowners to invest in social capital. The findings are also largely consistent with the proposition that built-up neighborhoods provide protection from inflows of newcomers that could upset a mutually beneficial equilibrium involving reciprocal cooperation.
Translated, what this means is that home owners really do put more effort into building social ties ('social capital investment'), but only really in places where it's harder to build new housing ('more inelastic supply'). One possibility is that this is because in such areas any local improvements as a result of stronger social ties are more likely to result in higher house prices, while in areas with elastic supply rising demand results in more new homes and no effect on prices. It's worth noting that Dr Hilber previously found that in Massachusetts even elderly homeowners without kids tend to vote for (and pay for, through taxes) investment in schools because it increases the value of their home.

Many people might say there's nothing wrong with any of this, and that if home ownership gives people a financial incentive to care more about their neighbourhood then so much the better for home ownership. My concern is that it also seems to give people a financial incentive to oppose new housing supply in their neighbourhood, as new development may reduce the value of their home (either through a supply effect or the amenity impact of extra housing) or, as Dr Hilber suggests, upset the social balance they have helped create. If homeowners are really less likely to be socially virtuous when housing is plentiful then it sounds like a society with high levels of home ownership and strong social ties may also be one with a persistent housing shortage.

And indeed, that's kind of what the basic numbers suggest. Surveys show that a sizeable majority of home owners say they would oppose new homes being built in the local area, while private tenants are basically split and social housing tenants are in favour of new housing. And over the long run, the rate of new housing supply has fallen while the rate of home ownership has risen. The graph below charts one against the other for England as a whole, starting in 1972 and ending in 2011. Throughout most of the 1970s we were building around two new homes for every new household, but over time, the rate of building fell as the rate of home ownership rose. There was obviously a lot of other stuff going on at the time so I'm not categorically claiming a causal relationship, but it's not a particularly positive picture either.

To sum up, I'm not sure home ownership gives people a stake in 'society' so much as it gives them a stake in their local neighbourhood, which is not the same thing, especially if one way to 'help your neighbourhood' is to prevent new homes being built there. That may make sense from a household's perspective (in fact for many people it certainly does) but that doesn't mean it makes sense for society as a whole.

Monday 3 December 2012

A few notes on getting Britain cycling

The All Party Parliamentary Cycling Group is holding an inquiry into how 'Get Britain Cycling' and they want evidence by the 5th, so the following is just some notes for my submission, mainly to get me to write something down rather than endlessly opening more browser tabs.

There is a large latent demand for cycling that is not being realised because of safety concerns
Just 2% of trips under 2.5km are cycled in the UK, compared to 14% in Germany, 27% in Denmark and 37% in the Netherlands (Pucher and Buehler).

Research by Transport for London found that only 7% of 'potentially cyclable' trips in London were currently cycled, and that safety (the lack of it, more precisely) is the greatest barrier to cycling.

A large DfT survey carried out in December 2009 found that:
  • 60% of people who can ride a bike say it's too dangerous for them to cycle on the roads, including 71% of women and 72% of those aged 60 or over.
  • 52% agree they would cycle more if there were more dedicated cycle paths (30% disagree).
  • 86% of people say that cycling is the least safe form of transport.
In 2011, two thirds of people in the British Social Attitudes survey said they were not very or not at all confident about cycling on the roads (DfT table).

Research shows that high quality, separated infrastructure is safest and most popular
  • "The key to achieving high levels of cycling appears to be the provision of separate cycling facilities along heavily travelled roads and at intersections, combined with traffic calming of most residential neighbourhoods". Pucher and Buehler, 2007
  • "Consistent with gender differences in risk aversion, female commuter cyclists preferred to use routes with maximum separation from motorized traffic. Improved cycling infrastructure in the form of bicycle paths and lanes that provide a high degree of separation from motor traffic is likely to be important for increasing transportation cycling amongst under-represented population groups such as women". Garrard et al, 2008.
  • "The greater the physical separation from motor vehicle traffic, the higher the women's share of cyclists". Pucher et al, 2010.
  • "The lower risks on quiet streets and with bike-speciļ¬c infrastructure along busy streets support the route-design approach used in many northern European countries. Transportation infrastructure with lower bicycling injury risks merits public health support to reduce injuries and promote cycling". Teschke et al, 2012.

We have a severe shortage of the right kind of cycling infrastructure
The under-utilisation of bikes for short trips, the survey findings on subjective safety and the high casualty rate in places where cycling is more popular all point to a widespread and severe lack of high-quality cycling infrastructure in Britain.

To get Britain cycling in safety central government must urgently address this deficit by
  • Revising DfT cycle design guidance so that high-quality, Dutch-standard cycling infrastructure is given the highest priority;
  • Making available sufficient ring-fenced funding to introduce high-quality separated cycling infrastructure in towns and cities across Britain in the next five years;
  • Allocating this funding through a competitive bidding round in which funding goes to the proposals that combine the highest quality design with the greatest impact in terms of current and potential cycling demand.
Leadership from central government is vital 
Many local authorities lack understanding or expertise in designing for cyclists, and in many parts of the country so few people cycle that they hardly impinge on local political consciousness at all. The fastest and best way to get local authorities to act is for central government to provide the right funding and the right guidance.

Higher rates of cycling will save people money and bring wider benefits
  • In total, people in Britain cycle about 3.1 billion miles a year (DfT). 
  • But on a per person per day basis, people in the Netherlands cycle about 12.5 times as much as those in the UK (Pucher and Buehler). 
  • That suggests that if people in Britain individually cycled as much as the Dutch we'd cover about 39 billion miles a year. 
  • According to these figures from Edinburgh cycling saves you between 55p and 60p per mile compared to driving, taking all costs into account. 
  • So people in Britain are already saving almost £2 billion a year by cycling instead of driving, but if they cycled at Dutch rates they would save over £20 billion.
  • These figures may be a touch too high, since there are other (and usually cheaper) alternatives to cycling than the car. They're also fairly dependent on volatile variables like petrol prices.
  • But they also exclude the wider social and environmental benefits of cycling and driving, which are very large (even taking into account higher average casualty rates from cycling), perhaps three times as high as the private cost savings (Figure 3.1 here).
  • So it's probably fair to say that achieving cycling rates akin to those in the Netherlands would deliver private and social benefits to the value of tens of billions of pounds.