DHAKA'S TRAFFIC GRIDLOCK

Two recent op-ed articles on the pages of The Daily Star caught my attention. The first one was written by architect and planner Adnan Morshed on "Rethinking the roots of Dhaka's traffic congestion" (August 22, 2015) and the second by The Daily Star Assistant Editor Syed Mansur Hashim on "Rationality of fuel prices" (August 25, 2015). The issues they bring up in their respective essays are connected, since they both list some important factors that contribute to the traffic jams in Dhaka.

Morshed points out that the culture of car ownership and the mindset that leads to what economists call "conspicuous consumption" are leading to our preference for private rather than public modes of transportation. If our demand for cars, particularly gas-guzzling automobiles is partially responsible for the traffic gridlock, then one ought to sympathise with his call for initiatives to alter our behaviour pattern. Hashim, on the other hand, writes very convincingly of the paradox inherent in the current policy of pricing CNG low and keeping price of petrol high. Hashim laments that "the discrepancy in pricing between one unit of compressed natural gas (CNG) and per litre of octane is so vast that it has fuelled the massive conversion of vehicles…" With price of CNG pegged at a level lower than what is sustainable (both in terms of the impact on the environment as well as the depletion of this valuable natural resource), he argues that city roads get clogged with cars, four-wheelers and buses that take to retrofitting with CNG motors, and this perverse policy enables operators to keep the vehicles running longer than otherwise would have been possible if prices were higher. Simple economics!  And, the policy of an implicit subsidy on CNG, and the price structure where the price of CNG is one-third that of gasoline, even when rational economic planning and considerations of sustainable growth would dictate otherwise, keeps us on the roads whether we are moving fast or not!

Thus, while I agree with Hashim as well as with Morshed - where the latter argues that the solution to our traffic problem does not lie in making more roads - my take on the cause and solution to traffic jams is slightly different from that of Morshed. My point of view is that traffic congestion is not all about our values, and the issue is not 100 percent cultural, but also an economic and political one. If the government adopts some of the policies available to combat traffic problems, as adopted in major cities such as London, Mexico City and Ho Chi Minh City, then we will find that we can also solve the problem of air pollution while lessening the traffic gridlock which has landed us in the category of the second worst liveable city.

Traffic jams and all the other negatives of living in a city which supports 18 million people are inevitable. As one OECD study succinctly puts it, "Urban areas will never be free of traffic, we just have to manage it. Dynamic, affordable, liveable and attractive urban regions will never be free of congestion. Road transport policies, however, should seek to manage congestion on a cost-effective basis."

What are the tools we need to use? Economic tools have a long track record of being some of the most effective ones! That is because human beings respond very positively to economic incentives. These are known to be quite effective in changing our behaviour and to help us make our roads navigable. As Hashim argues, for example, keeping the price of CNG low led to many behavioural changes including owning and retrofitting our cars and other four-wheelers. 

Economic tools work better than command and control mechanism to manage traffic gridlock. The cost of the traffic jams, however we measure it (cost of time, business loss, air pollution, or damage to our infrastructure, among others), is enormous. The total annual cost due to traffic congestion in Dhaka is found to be USD 3.9 billion. That will eventually sink in if we just start paying attention to per capita cost and keep that as a benchmark as we debate various policy options. Is the fetishism we note in our culture for driving a nice car one that can be addressed by admonitions or appeals to our conscience? I doubt it!

Let me offer a daring idea. We could, as a first-step measure, try to take some of the cars off the road. As Morshed writes, "The share of private cars in Dhaka's daily commutes is a negligible 5-10 percent, but private cars occupy a staggeringly asymmetrical 70-80 percent of the road space" and we keep on adding 200 cars a day in Dhaka. Or to quote Hashim, "Can we afford the luxury of pumping cheap fuel into carriers for the more affluent in society while industry starves?" How can we then provide incentives to our private car owners to cut down on "road time" or increase the cost of parking illegally on the roadside? The toughest decision is to pick a few from about twenty practical measures (for example, raising the cost of auto registration, vehicular restrictions on Mohakhali Road, etc.) which are feasible to implement, but can pass political muster. Then the question is, can we implement any of these?

Last but not least, I was reminded of an interesting quip to characterise the inertia we suffer from when we discuss Dhaka's traffic woes. More than a century ago, Charles Dudley Warner (although it is often misattributed to Mark Twain) said about another problem, the weather, "Everybody complains about the weather, but nobody does anything about it." So, let me summarise the key takeaways from this polemic.

Traffic jams cannot be eliminated but only better managed. Economic incentives ("carrots and sticks") are often more effective to change human behaviour. We need a moratorium on policies that address traffic problems but don't weigh the cost-effectiveness of all alternatives.

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The writer is an economist and professor who writes on public policy issues.