When Driving Slower Makes No Economic Sense

One thing I have noticed is that despite the increases in gasoline prices, people do not appear to be driving any slower (on I-35 between Austin and San Marcos) so as to increase their fuel efficiency. Of course, to a certain extent, one's choice of driving speed is limited: drive too quickly and you risk getting a ticket; drive too slowly and you risk becoming a sitting duck for the other, faster drivers. But it seems to me that many people could drive slower than they do and do not choose to do so, despite the cost savings. Sometimes I will get stuck behind a slow-moving vehicle in the right lane, and I realize how infrequently people drive below the speed limit. There are a lot of cars (like mine) traveling pretty much at 70 mph all the time.

However, once you start looking at the actual math, it becomes quickly obvious that people who drive at the speed limit of 70 mph are not going to slow down. Even if it didn't increase the perception that you may get into an accident (as the disparity between your own speed and the cars around you becomes greater) and decrease your fahrvergnugen, for most people, it doesn't make sense financially.

My commute on I-35 is a total of over 40 miles per day. I currently drive 70 mph. If I were to decrease my speed to 60 mph (which I believe is not so slow as to be very dangerous, at least driving in the right lane), I would increase my drive time by 8 minutes per day.

However, I read that reducing one's speed from 65/70 to 55 mph will increase fuel efficiency "up to" 21%. Let's be generous and say that going from 70 to 60 will increase my gas mileage by 21%. This means that my car would go from its typical 32 mpg to 38.7 mpg.

At $4 per gallon, this saves me $0.88 in gas for one round-trip, or $0.11 per minute.

This means that my break-even point occurs when I value my time at $6.60 per hour. If I value my time above $6.60 per hour, it makes no sense to drive 60 instead of 70.

It's often difficult to figure out how much we value our time at. Some people look at their hourly wage, but this is usually done by dividing a fixed salary by the time they work - it does not represent an amount of money that one could actually earn by working an extra hour. So just calculating that you make $X per hour at your job doesn't tell you anything about your opportunity costs.

But I am in a special situation: I do make a genuine hourly wage at my job, and I am allowed to work up to 40 hours per week (earned in 15 minute increments). Since I am currently working about 32 - 35 hours per week, I am actually forgoing earned money in order to consume leisure. So I can use my hourly wage to see that I appear to value my time at more than $6.60 per hour - my pre-tax wage is $10 per hour, and my post-26%-tax wage is $7.40.

Of course, it's possible that I am simply not willing to work more time at my job for the higher wage because I'm burned out, but would be willing to do a different job for $6.60 an hour. This may or may not be the case, but it is certainly not the case that I would be willing to take a job driving a car on I-35 for $6.60 an hour. Taking on that driving job would much less pleasant than extra time spent writing a book in InDesign, which I am currently forgoing.

The upshot for me is that I am continuing to drive 70 mph and have started working an extra 15 - 30 minute per day, on average. I am actually coming out ahead this way.

But what if a person has a car that gets lower gas mileage than mine? As the gas mileage decreases, the economic benefit of driving slower increases, and the break-even wage goes up. If you drive a car that gets 22 mpg, you wouldn't slow down if you value your time at more than $9.47 per hour. If you normally get 15 mpg (Hummer driver), you wouldn't slow to 60 if you value your time at more than $13.88 per hour.

Once you factor in the potential loss of "fun," autonomy, and feeling of safety that comes with slowing down and being trapped in the slow lane, with other cars coming up behind you in irritation and all that, it doesn't look like a very good deal. Given that so many people value their time/driving pleasure such that they drive faster than the speed limit and incur the added risk of a driving ticket (which costs money and slows you down), how many people will actually find the economic benefit of $6 - $14 an hour worth it?

(This is particularly relevant when you think about people driving on their commute. For many, the cost of gas is going to be another necessary expense - like buying suits and ties and briefcases and Starbucks at 7:45 a.m. - of having their job, and minimizing the time of the commute is going to be very important to them.)

And here I really do mean, how many people would find $6 - $14 worth it, even if they knew that this was the cost of driving 70 rather than 60? This article says that in 2004, the average car/truck on American roads gets 24.6 mpg, which works out to a break-even point of under $8.50 an hour. It seems to me that a good number of the people who would find $8.50 an hour worth it either cannot afford to have a car and rely on public transportation/bicycle/etc. or do not drive far enough on their daily commute for the actual (not hourly) money to be worth the downside of driving slow. One big downside is the risk of being late to work, and it seems likely to me that people in lower-paid hourly-wage jobs face greater punishment for being late than your typical salaried professional.

Using another set of assumptions and figures would create a different break-even point for driving slower, of course, but $6 - $14 per hour seems like a plausible range to me. And I think that people who don't like driving will not find this high enough, and people who do like driving will find crawling at 60 in the slow lane undesirable.

And honestly, when I think about people who place low value on their time, I come up with a stereotypical image of an old person who is already driving too slow on the highway.