1. What is induced demand?

Induced demand is a concept from economics: as supply increases and incurred costs decline, demand will increase. This phenomenon has been widely observed and studied in transportation systems where highways have been expanded to alleviate road congestion problems.

2. How does the concept of induced demand work in transportation systems?

As highways become congested due to population growth and increased usage, or as transportation agencies plan for anticipated population growth, highways are expanded. This includes widening roads and adding new traffic lanes to increase capacity and manage congestion. Generally, these expansion projects ease congestion in the near term. However, the benefits do not last. Instead, travel demand grows proportional to the added capacity.

Highway expansion projects typically follow the same patterns. The increased road capacity created by the new added lanes eases congestion and reduces the costs associated with travel times. The eased congestion attracts additional drivers to use the roads. Some of the new drivers include people who would have previously met their travel needs using other roads or alternate modes of transportation to avoid the congested highway. Other new drivers arise from the urban sprawl made possible by the expanded highway.

Over time, highway usage continues growing until the congestion benefits created by the expansion disappear altogether. Then the cycle starts over again, and new highway expansion projects are planned to, once again, ease the congestion problems—and their related impacts such as air pollution—that have now returned.

3. What are the consequences of road expansions?

Road expansions do not ease road congestion in the long run. The evidence shows that, ultimately, they make traffic and pollution worse as short-term congestion relief is usually offset by increases in driver usage of the expanded roads within 5–10 years. But there are other consequences as well:

• Road expansions are expensive. The cost of a typical road expansion project is measured in millions to billions of dollars. And as temporary solutions, it is only a matter of time before the next expansion project for a given road requires an additional multi-million or multi-billion dollar investment. These expenditures direct funds away from transportation alternatives that can provide effective, equitable, and long-term solutions.
• Road expansion projects disproportionately impact the disadvantaged and communities of color, who must contend with increases in air pollution or, worse, are displaced from their communities to make way for additional lanes.
• Road expansions cause urban sprawl. Highways connect suburbs to a city center, which encourages development along the highway. As highway expansions allow ever-greater volumes of traffic to travel the road, development spreads further out. This is particularly true after the completion of a road expansion project, as eased congestion provides a temporary illusion that relatively rapid travel from increasingly further out distances to the city center is the norm.

4. What are alternative strategies for addressing road congestion and the transportation needs of a growing population in a region?

Many alternative transportation strategies exist for addressing road congestion and the increasing transportation needs of growing populations. Collectively, they support a broader concept known as traffic demand management, which is the application of strategies and policies to reduce travel demand or redistribute it in space and time. When used together, these strategies can provide the long-term solutions to transportation challenges that freeway expansions only deliver in the short term. Some key alternative strategies include:

• Smart Growth: Smart growth is an overall approach to development that encourages a mix of building types and uses, diverse housing and transportation options, development within existing neighborhoods, and robust community engagement. Smart growth development allows more people to access their critical needs—including jobs, education, healthcare, and recreation—without needing a car.
• Public Transit: Public transit systems have long provided alternatives to personal vehicle use for transportation needs. Expanded investment in public transit, and the infrastructure to support it, increases public transit usage by enhancing convenience and safety, making it a more attractive transportation option for many. In addition, public transit investments generally provide benefits for much longer timespans than the 5–10 years for the benefits typically provided by highway expansions.
• Street Design: Street design plays a large role in how streets are used, and streets have historically been designed to prioritize individual vehicle usage. However, streets can also be designed to give greater priority to walking, biking, and public transit.
• Road and Parking Pricing: The costs and externalities of driving personal vehicles are not often reflected to the experiences of individual drivers. Implementing pricing schemes for road and parking usage to reflect these costs and externalities more accurately can encourage and incentivize behavior to use alternative transportation options.

5. What is a Metropolitan Statistical Area (MSA)?

A metropolitan statistical area (MSA) is a core geographical region in the United States containing a city (with a population of at least 50,000) and adjacent communities that are linked by social and economic factors. MSAs are defined by the United States Office of Management and Budget based on Census Bureau data.

6. What is the source of the VMT data used by the SHIFT Calculator?

The SHIFT Calculator utilizes existing lane mileage and VMT data from the Federal Highway Administration (FHWA).