Traffic Congestion Impact on Dubai’s Economic Growth Dissertation

Abstract

In this paper, we sought to find out the impact of traffic congestion on Dubai’s economic growth. Using a mixed methods research approach, we undertook a secondary literature review analysis and supplemented it with a review of expert findings to investigate the research issue. Generally, our investigations show that traffic congestion has a negative impact on the economic growth of Dubai. Intricate details of this finding emerge throughout the five chapters of this paper. They allude to the increased costs businesses in Dubai would incur because of an increase in wage rates and delivery costs, which are direct results of traffic congestion in the Emirate.

Issues of market access also emerge in this paper as other areas of key concern for local Dubai businesses because they demonstrate how traffic congestion problems in Dubai affect the demand side of the economy. These traffic-related problems make Dubai relatively less competitive than other upcoming economic centers in the Middle East. Consequently, in this paper, we propose that Dubai authorities should see traffic management as an important consideration in the management of the economy.

In the same line of analysis, in this paper, we point out the need for formulating new ideas in traffic management as a possible solution to the perennial problem. This recommendation is a sharp contrast from traditional methods of congestion mitigation measures, which have relied on road traffic expansion. Borrowing from the principles of the triple convergence theory and the expert reviews contained in this paper, in this paper, we also propose the need for using ingenious methods of traffic management, such as car-pooling, to avert some of the inherent problems associated with increased traffic congestion in Dubai.

Generally, the findings of this study provide an in-depth insight into how urban traffic congestion in Dubai affects the main producers of goods and services in the economy. The analysis includes (but is not limited to) the business costs, productivity, and output of the affected businesses. The sensitivity accorded to this analysis stems from the fact that some economic sectors of Dubai are vulnerable to the mobility of labor, and the availability of specialized inputs, which are influenced by traffic congestion problems.

Introduction

Background

According to multiple studies, an efficient public transport system is essential for the economic prosperity of most metropolitan cities (Arasan 1; Eddington 2). Indeed, regardless of whether a country is developing, or developed, many road users often appreciate the importance of having an efficient road transport system. Apparent of latent, the Oxford Business Group (3) supports this assertion by saying that in many cities around the world, people require and value the multiplicity of road transport networks.

Most public transport systems entail a conveyance of general or special public transport systems for all people willing to pay a fee to move around a city. By definition, public transport excludes road transport services offered by school services or charter sighting services. In this regard, public transport services often encompass various modes of mass transport, such as boats, ferries, subways, taxis or buses.

In many urban centers, an efficient and functioning public transport system is essential to the economic and social development of the society (UN Habitat 64). It also has to be competitive and attractive to road transport users. For it to meet the threshold of being termed effective and efficient, the road transport system also needs to be safe and provide high quality services to people who want to move from one point of the city to another.

According to Arasan (1) and Eddington (2), it also needs to follow specified schedules and use available resources efficiently. The Oxford Business Group (3) supports the above assertion by saying that the public transport system often helps to improve the economies of different nations and the welfare of communities because it helps them to have access to efficient and effective transportation systems which would allow them to move easily and cost-effectively. This way, the public transport network helps to increase the mobility of people and goods in an economy and, at the same time, provide employment opportunities for citizens.

Solving traffic congestion problems and improving the quality of services offered in public transport is therefore an essential requirement for the efficient running of any nation’s economy. It also solves some of the problems associated with industrial development and rapid economic growth, such as rural-urban migration, because increased interconnectivity helps to increase the access and supply of labor and other factors of production to urban areas (Kuo 440). Similarly, people do not necessarily have to travel long distances to get goods and services.

Nonetheless, traffic congestion continues to bedevil many major cities around the world because of an increase in human populations, number of cars on the road and limited road networks that cannot keep up with the demand for efficient transport services. The problem is worse in developing nations because of rapid economic growth and unplanned developments (Smeed 33). Consequently, many cities in these countries suffer unpredicted travel times, increased fuel consumption of cars, and massive delays in project times and schedules (UN Habitat 64).

These disadvantages are true for most Gulf Cooperation Council (GCC) countries because rapid economic growth and a growing middle-class have increased the number of road users. However, the traffic network has failed to keep up with this demand. The United Arab Emirates (UAE) is suffering from this problem, and so is Dubai, which is the most populous Emirate in the country.

Since the confederation of the United Arab Emirates (UAE) in 1971, the use of road, maritime, and air transport systems outlines the major modes of transport in the country (road transport is the major transport mode in the UAE). The development of the current road transport system in Dubai, as we know it today, was in response to a non-existing or inefficient transport system that existed in the UAE. Since the 1970s, the Dubai government has strived to develop an efficient intra-urban public transport system.

For example, in 2009, authorities in Dubai introduced the Dubai Metro to address some of the perennial traffic problems in the Emirate (UN Habitat 64). Since then, this transport network has become part of Dubai’s image and added to its global reputation as a progressive city. The most important player in Dubai’s road transport network is the Dubai bus because it is expansive and links different parts of the city.

According to observers, traffic congestion is at the top of the list of concerns for most residents of Dubai. Economic experts have quantified the monetary losses accruing from this problem to Dh 4.6 billion annually (Gulf News 1). This figure means that Dubai is wasting more than 3% of its Gross Domestic Product (GDP) through traffic congestion. The rate of car ownership in the Emirate has worsened this problem because there are 541 cars for every 1,000 people (Gulf News 1).

This statistic is higher than the car ownership numbers for major cities of the world, such as New York, London, and Singapore (UN Habitat 64). According to some traffic experts, the city mostly suffers from a flawed road traffic network and a poorly planned infrastructure network that has failed to anticipate population growth (UN Habitat 64). Cumulatively, these problems have resulted in wasted man-hours, thereby leading to massive economic losses.

Broadly, despite the existing benefits associated with different types of public transport systems, we see that Dubai, being a major city in the Middle East, has still not fully embraced the concept of public transport efficiency (Mason 97). This is why it continues to suffer extended periods of traffic congestion along its major highways. However, the need to develop an efficient public transport system and the importance of solving the city’s traffic congestion problems has found a new impetus in the public transport policy of the Emirate.

This paper contributes to this discussion by investigating the impact of traffic congestion on the economic growth of Dubai. Its findings are not only timely, but of great significance to the residents of the Emirate as well because most citizens are quickly being frustrated by perennial traffic problems in the region.

Research Problem

The mobility of labor and people (customers) is essential to the economic functioning of most modern economies. With rapid urbanization and the growing economic development rate in the UAE, Dubai has started to suffer from the problems, or challenges, associated with having an inadequate and inefficient public transport system. Consequently, most of its highways are clogged with cars, especially during rush hours because many people still rely on this mode of transport for their daily commute.

Although there have been recent developments made to improve the public transport network in the Emirate, research studies show that up to 70% of residents in Dubai believe that the city suffers from a serious public transport problem (Gulf News 1). A bigger majority is frustrated with the long waiting times associated with moving from one point of the city to another, while an even greater percentage of citizens say the inadequate transport system is affecting their perception of “livability” in the city (Gulf News 1).

The lack of a public transit quality plan for Dubai has further compounded this problem because it has mostly promoted the use of private vehicles as the main source of transport (Mason 97). For example, recent studies have pointed out that Dubai has witnessed a rapid increase in the ownership of private vehicles, which has been supported by liberal policies of property ownership that do not prevent people from owning cars, or registering them whenever they want (UN Habitat 64).

As if the situation is not bad enough in Dubai, the city’s popularity in the Middle East and the UAE has also led to the rapid influx of cars from other Emirates in the UAE. Many observers point out that the failure of the government to anticipate the congestion problems stemming from an increase of private vehicles on the road have rendered Dubai’s existing public transport system inadequate to cope with the transportation needs of residents of the city (Arasan 1; Eddington 2).

The lack of quality planning in transit system has not helped to improve the situation either because the city lags behind other world capitals in having a reliable public transport system that would ease the traffic of people seeking public transport in the city. Consequently, Dubai is gaining an image of notoriety for having a bad public transport system. Among the multitude of environmental and economic costs associated with the traffic congestion problem, there is an unnecessary drain on resources by the UAE government, as it continues to pump in a lot of money on short-term measures to manage the city’s traffic problems (UN Habitat 64-66).

Furthermore, there is an existing problem of traffic management inefficiency stemming from the failure of authorities to allocate financial resources in traffic management correctly. This problem has manifested in increased running costs for buses that often do not operate in their full capacities. The same problem stems from hiring a high number of public transport employees and drivers, which is not commensurate with the demand for public transport services, or people who are willing to use public transport systems in the first place.

Broadly, there is a problem in understanding the effects of traffic congestion on the economy of Dubai and in understanding how current initiatives to solve the problem are not acting fast enough to mitigate this issue. Consequently, public officials in Dubai are not doing enough to mitigate this problem. Therefore, traffic congestion in Dubai continues to have a huge economic cost on its economy because according to the Dubai Road and Transport Authority (RTA), the problem costs the economy more than $790 million in wasted person-hours (Gulf News 1).

The economic losses accrued from the transport problem could have been higher according to the UN Habitat (66) which says that $16 billion worth of infrastructure upgrades have saved the economy more than $3 billion in losses.

Some researchers say that the high traffic congestion in Dubai is worrisome because it continues to pose a problem to city residents during times of economic bloom and gloom. The Oxford Business Group (3) adds to this argument by saying that increased vehicles on the road is problematic to the Dubai economy because it implies increased costs of doing business and high running costs for workers who have to get to work every day and for their families who have to commute to different parts of the city.

Generally, economic experts believe that the high traffic congestion in Dubai would greatly undermine its competitiveness and position as the go-to place in the UAE and the larger Middle East region. Although there are numerous studies that have quantified the effects of traffic congestion on the city, there has been little or minimal response by Dubai authorities to solve this problem from a policy, or infrastructural, point of view.

The problem could be the failure of the policy officials to understand how the traffic congestion problems affect the city’s competitiveness. Furthermore, a lack of information on the part of the same officials to understand the economic benefits that the city would enjoy from having a free-flowing traffic has made transport stakeholders unable to quantify the impact of traffic congestion on the economy. The findings of this paper would fill this void by investigating the impact of traffic congestion on the economic growth of Dubai.

Research Aim

To investigate the impact of traffic congestion on the economic growth of Dubai.

Research Questions

• RQ1: How accessible are various economic hubs in Dubai?
• RQ2: How would the accessibility of these economic hubs change in the future?
• RQ3: How would increasing or expanding the Dubai road transport network increase the accessibility of its economic hubs?
• RQ4: How would increasing the accessibility of Dubai’s economic performance affect the economic performance of the region?

To get an accurate measure of the impact of traffic congestion on Dubai’s economy, we will use the gross domestic product (GDP) as a measure of the country’s economic output. This measure is useful in measuring the value of the sum of all goods and services in the economy. Therefore, the impact of traffic congestion on Dubai’s economy would be a percentage of this measure.

Significance of Study

Broadly, this study is important for four main reasons:

To provide a thorough measurement of traffic congestion on the economy

The main point of this study is its ability to provide a reliable measurement of the monetary cost of traffic jams on Dubai’s economy. By providing a complete measurement of traffic congestion on regional and local economies, we move away from estimating the cost of traffic by accounting for user expense and travel time cost, which are inaccurate and ineffective measures of traffic congestion (Kuo 440).

This assessment would also encompass the correct estimation of productivity costs that would be easily affected by travel time variability and other metrics that would be subject to traffic situations, such as worker time variability, and the economies of market access. Other variables may include freight inventory, logistics scheduling and just-in-time production processes (National Cooperative Highway Research Program 13).

Provide a strong Link to Productivity Studies

This study is also important to the understanding of productivity studies because it incorporates realistic production functions. This assessment explains how businesses are able to substitute different aspects of production, such as workers and production inputs (such substitutions may occur because of high transportation costs or similar factors). This analysis is of particular importance to people who want to understand the intricacies of production economics through the reconciliation of transport assessment methods and aggregate studies that have explored the relationship between business productivity and transportation investment. Within this scope of analysis, we can also easily understand the effects of travel time reduction on the induced traffic growth in cities that have a similar profile as Dubai.

Scale Economics

The economic analysis highlighted in this study provides an in-depth insight into how traffic congestion could shrink business market areas and possibly undermine the economies of scale metrics that business operating in Dubai’s urban areas would have otherwise enjoyed.

Application for Policy Testing

The structure of this paper and the presentation of its arguments outline a broad analysis of how Dubai could estimate its economic cost of congestion in the city and the wider UAE region. This paper provides results for a congestion alleviation strategy that could provide a model of economic analysis that would not only be useful for Dubai, but other Middle East cities as well. The model would most likely consider the effects of traffic congestion on economic growth patterns, based on analysis of the effects of traffic congestion on the cost of doing business. This way, we can have a fuller picture of the trade-offs among different kinds of investment in the transport sector, or in other economic sectors, thereby providing a departure from the use of user costs to analyze traffic congestion problems.

Collectively, the findings of this study would be useful to people who want to understand the economic implications of traffic congestion in the Middle East because Dubai is a model city in this region. Since past studies have highlighted the complexity of the relationship between traffic congestion and economic growth, the findings of this paper should be viewed as an incremental step towards a broader understanding of the same relationship.

Here, it is also important to point out that the findings of this study do not give the final word on the research issue; instead, it provides a starting point for a deeper analysis of the same issue by highlighting the different facets congestion and their effects of businesses in Dubai. Additionally, the findings of this study provide us with a more accurate measure of assessing the monetary cost of traffic jams in Dubai and other major cities like it in the UAE and the wider Middle East region. As highlighted in the first chapter of this report, this analysis is more reliable and comprehensive than the reliance on user experience and travel time cost to understand the economic cost of traffic jams in Dubai.

Indeed, the findings presented in this study go a step further by including a productivity analysis of associated travel time variability. It also includes information about market accessibility, travel time variability, and worker time availability (among other productivity elements that are vulnerable to transport conditions). The result is a general model that researchers or academicians could use to understand the impact of traffic congestion on the economic growth of Dubai and other cities that share its profile.

I chose to study Dubai in this case study because the city is among the leading financial centers in the Middle East and one of the most recognizable economic centers in the GCC region. The World Bank and other global organizations affirm this fact because they have pointed out that this region is a promising economic hub of the Middle East (Kuo 440). However, as we have seen, there are serious capacity problems in Dubai’s urban and rural road transport networks that undermine this position.

Addressing these capacity gaps could help to promote economic growth in the region and encourage regional integration among the different metropolitan areas that are interlinked to Dubai’s economy. Furthermore, understanding how to solve the high traffic congestion problems in Dubai would help to improve the quality of life for residents of the city and help in creating employment opportunities in the transport sector and virtually many other economic sectors of the Emirate, which depend on the efficient and timely mobility of factors of production.

Literature Review and Conceptual Framework

Introduction

Many researchers have presented different kinds of solutions for helping cities to manage their traffic congestion problems. Their solutions have been premised on the notion that addressing traffic congestion problems is the key to increasing a region’s economic growth. This view underscores the need for proper planning in Dubai’s public transport network because for the city to sustain its growth, or to keep maintaining a pioneer image in the Middle East, it needs to anticipate its transportation challenges and mitigate them before they occur.

So far, Dubai is engaging in different kinds of projects to increase the capacity of its road transport network. However, as we have seen in the first chapter of this paper, the city continues to suffer from major traffic problems. Similarly, its infrastructure development goals have not coped with the demand for an efficient transport system. This analysis leads us to investigate the main causes of congestion in Dubai. In this chapter, we review the theoretical foundations of this analysis and analyze what other researchers have written about the research topic. The data we gather from this review provides fodder for the development of a conceptual framework, which is highlighted in this chapter and would provide the framework of review of our findings in the fourth chapter.

Traffic Congestion

According to Downs (18), traffic congestion is not essentially a problem, but a response of modern societies to move across different points within specified times. Essentially, the main premise of modernity is that people move to different points, institutions, or companies at specific times so that they work together at known times. It is difficult to disrupt this normal way of working without disrupting how our economy works in the first place.

This problem is not unique to one city in the world; it is prevalent in many developed economies of the world. In America, most people choose to use private vehicles to move from their places of work to their homes for multiple reasons. First, most Americans live in sparsely populated areas, which are not easily serviced by public transport systems (Hartgen 3). Secondly, even for people who live in densely populated areas, the existing public transport system lacks the capacity to handle many people during rush hours. This problem causes inconveniences for people who have to wait in line to be served. In a way, waiting in line still amounts to congestion as having many cars on traffic does.

Effects of Traffic Congestion

Generally, researchers say traffic congestion problems result in negative economic outcomes for the city and the creation of inefficient systems in the region’s economic processes (Oxford Business Group 3). Delays in transportation are other problems that have emerged from road traffic congestion in the city because people have to take a long time to reach their destinations. Consequently, there is a lot of time wastage in the economy as people reach their places of work tired and late.

Overall, this problem results in the overall decline of economic activity in a city. Delays in the delivery of perishable products are even worse for the economy because traffic congestion could lead to the complete destruction of such produce. Such losses could devastate businesses and possibly lead to the provision of poor quality products. The overall loss of time associated with traffic congestion problems amount to wasted resources because people could use this time for more productive activities.

Research studies that have investigated this issue in-depth prove that if this wasted time were translated to leisure time, people would theoretically have a greater tolerance for traffic congestion, as opposed to enduring the time wastage sitting still in traffic (Oxford Business Group 3).

The traffic congestion problem in cities has also affected the convenience of people who drive cars, especially when they are looking for places to park. Indeed, it is very difficult to get a parking space in a busy city because of the high number of cars plying the routes and the high number of people driving today (compared to the past). Even when parking is available, there is a lot of strain involved in driving out of the central business district (CBD). Consequently, many people reach their homes tired and unproductive. Consequently, they cannot engage in other economic activities.

At a psychological level, the high traffic in major cities has made many people aggravated about the problem. Such a problem has influenced their driving habits negatively, thereby compounding the recklessness seen in most city roads and the high number of deaths associated with the same. At a larger and global level, many researchers have highlighted the negative effects of traffic congestion problems not only on the social fabric of a society, but also an economy (Downs 19).

For example, studies that have investigated the problem in Cairo point out that in a city inhabited by about 20 million people and characterized by 2 million cars on the road, traffic congestion problems cause the city about 50 billion Egyptian pounds annually (Clarkson 3; Downs 19).

This figure is equivalent to 4% of the country’s GDP. By most measures, the economic cost of traffic congestion in the city is talking a huge toll on the country’s economy. Nonetheless, comparative studies have shown that major world capitals, which suffer from the same problem, have managed to minimize its effects on the economy significantly. For example, Jakarta, Indonesia, which has a similarly huge population of people and suffers from the same traffic problems as Cairo does suffers a 0.6% negative effect of traffic congestion on the economy only (Clarkson 3).

The study of the relationship between traffic congestion and economic performance takes a more interesting dynamic when we analyze how major American cities deal with their traffic congestion problems and how they quantify the same, relative to the size of their economies. Joining this discussion is Downs (20) who says that the major cities in America with the largest economies also have among the worst traffic congestion problems in the world.

Downs (20) tries to explain this phenomenon by saying that traffic congestion problems is a sign of economic prosperity because it means that many people have places to go to. To support this assertion, Clarkson (3) points out that during the 2013 government shutdown, there was a noticeably significant decline in traffic congestion problems in North Virginia. Similarly, to demonstrate this observation, Clarkson says, “Congestion is a bit like cholesterol – if you don’t have any you die. And like cholesterol, there’s a good kind and a bad kind” (3).

According Hartgen (7) who has conducted a study on the effects of traffic congestion, in America, the UK, France, and Germany says that traffic congestion does more than just test our patience; it also drains our wallets and inhibits the economic performance of a country. According to his study, the combined cost of traffic congestion in these countries is more than $290 million annually (Hartgen 7).

This statistic highlights the effect of traffic congestion for the aforementioned countries in 2030. It is also a staggering 50% increase in the cost of traffic from the year 2013 (Hartgen 8). The cumulative cost of congestion for the sampled countries is estimated at a staggering $4.4 trillion. The US is seen to bear the greatest economic cost of traffic congestion because by 2030, experts estimate that it would cost of the country more than $2.3 trillion (Hartgen 8). This figure is similar to the amount of money Americans paid in taxes in 2014. Therefore, the economic cost of traffic congestion, if left unchecked, could be staggering for the economy.

Nonetheless, experts estimate that the UK and London in particular would bear the greatest increase in road traffic congestion because the increase in traffic congestion could rise to 66% by 2030 and 71% for London in the same year (Arasan 1; Eddington 2). At a personal level, experts estimate that traffic congestion cost users in the US, France, the UK, and Germany an average of $1,740 (Arasan 1; Eddington 2). If left unchecked this number could increase by up to 60% in 2030 (Eddington 2).

Environmental Impact of Congestion

This chapter has mostly highlighted the negative effects of a poor road transport network in Dubai and other major cities around the world. However, researchers who have properly investigated the negative impact of congestion on cities say that its negative impact on the economy is not only limited to monetary terms, but also environmental terms (UN Habitat 64-67). The environmental impact of traffic congestion is often poorly understood, at least compared to the economic impact of traffic on the economy and human life.

Indeed, with most working class citizens in the US and Europe wasting up to 111 hours on traffic annually, the economic, or monetary, effects of traffic congestion are easily understood. However, we cannot say the same when analyzing the environmental impact of traffic congestion because it is difficult to quantify this negative effect. Nonetheless, most researchers point out that traffic congestion causes a significant environmental problem for affected cities because it is a leading cause of burning the world’s petroleum.

Fossil fuel (petroleum) is a significant source of greenhouse gas emissions, which negatively affect the environment. An analysis of different economic sectors also shows that the road transport sector is the leading cause of environmental pollution in the world (UN Habitat 64-67).

According to Eddington (2), the environmental problems caused by traffic congestions stem from a multiplicity of different factors, including an insufficient road network and an unbalanced use of roads at different times of the day. Another researcher says the problem partly emanates from the fact that many cars usually have one passenger and emit the same volume of harmful gases that it could have emitted if it had five or more passengers (Hartgen 3).

The average impact of traffic congestion in the Middle East region is 300g of carbon dioxide per kilometer for every car on the road (UN Habitat 64-67). This finding means that if a driver commutes from Sharjah to Media city, which is a distance of more than 40 kilometers during one year to work, the combined carbon dioxide emissions would be more than six tones. Generally, it is a known fact that traffic congestion causes many cars to stay on the road, thereby leading to high levels of carbon dioxide emissions and green house gas.

Based on this fact, Arasan (7) says people should not point fingers at those who commute from Dubai to Abu Dhabi daily and ignore those who do the same damage on the environment daily, while staying stationery in their cars (stuck in traffic). Therefore, he proposes that the best solution to address this problem is to increase the number of people in one car because it would translate to fewer cars on the road and ultimately a lower level of traffic congestion (Arasan 7).

According to the UN Habitat (64-67), the transport sector has contributed to a 47% increase in the volume of greenhouse gas emissions in the past few years. In the US, the transportation sector is responsible for 30% of the total greenhouse gas emissions (Hartgen 3). Owing to this fact, different countries have set up emission regulations for different types of vehicles, but their attempts have been undermined by an increase in the number of vehicle ownership and vehicle use in most countries.

Generally, these findings show that by reducing traffic congestion, there would be a significant increase in air quality standards and a significant decrease in greenhouse gas emissions, thereby improving the quality of life for most people. The environmental impact of traffic congestion problems also have an economic cost on the economy in the sense that investors are attracted to places that have good air quality and jurisdictions that appreciate the importance of having quality environment for doing business (UN Habitat 64-67).

Possible Solutions to Traffic Congestion Problems

Broadly, Downs (20) says there are four main ways that different cities could use to solve their traffic congestion problems. The choice to adopt them mostly depends on the political will of authorities in the respective cities and the financial muscle available to execute such strategies. The proposed methods appear below:

Charge Peak Hour Tolls

According to, Downs (20), the rate of congestion in a city would significantly decline if people were supposed to pay a prohibitive fee for driving in a city, within specified times (like peak hours). With such a system in place, the rate of congestion in a city would decline because people would have to move at high speeds to lower their transportation costs. “That would allow more people to travel per lane per hour than do now under heavily congested conditions.

That’s why transportation economists have long recommended this tactic” (National Cooperative Highway Research Program 20). Nonetheless, some people have objected to the use of this strategy to manage traffic congestion problems because it favors wealthier drivers, or those who could afford the toll fees and marginalizes those who cannot pay for the same. In this regard, it appears discriminatory. In other words, the wealthier drivers would have the freedom to travel whichever time of the day they wanted, while poorer drivers would have to travel only during off-peak times.

Another objection that has bedeviled cities that have tried to introduce such traffic mitigation strategies is the perception that a peak-hour toll is just another tax. People who hold such views often see gasoline tax as enough taxation that should already cover the cost of using the roads (Downs 20). This attitude creates the ground for objecting to the introduction of another type of tax. These grounds explain why few politicians often support the introduction of the toll fee.

Based on such objections, some cities have found it appropriate to introduce limited road-pricing schemes. However, it only solves traffic congestion problems in certain downtown areas. Consequently, only those cities that experience such types of congestion could benefit from such a measure. America and other countries that experience a different type of congestion have found it difficult to apply the same strategy (Kuo 440).

Expanding Road Capacity

Expanding a city’s road capacity is a measure adopted by many countries to accommodate high numbers of commuters along a specific road network. Critics say that this strategy is largely impractical and often involves the use of many resources, which may not be available to many governments (Kuo 440).

Besides the prohibitive costs associated with expanding the road capacity, critics also say that the expanded road networks would be severely underutilized during off-peak hours, thereby reducing the return on investments that should be associated with such capital-intensive projects (Kuo 440). Broadly, there is a consensus among many transport experts that although expanding a city’s road capacity would alleviate traffic congestion problems, it is not enough to solve a city’s traffic congestion problems, entirely (National Cooperative Highway Research Program 20).

Expanding Public Transit Capacity

Expanding the capacity of a city’s public transit system is an approach taken by many cities that have high populations of people and cars. The logic of expanding such a public transport system is to encourage people to use the massive transit systems and keep off the roads to eliminate a massive demand of key roads during peak hours. Most of the cities that have successfully adopted such a strategy have managed to reduce the number of cars on the road, but a small percentage of their populations use the mass transit systems.

According to Downs (20), expanding the public transit capacity would not yield great returns on investments because studies done in America show that even if the capacity for mass transit systems were increased four-fold, the volume of traffic during morning rush hours would only increase up to 11% (Downs 20). Comparatively, the traffic on major roads would only decrease by about 8%, which is hardly enough to end the traffic congestion problems on major highways in some of the world’s most developed cities (Downs 20).

Live with Congestion

Although unpopular and rather peculiar, some researchers have touted accepting congestion as another strategy of addressing the same problem. Those who have touted this suggestion argue that people should understand that congestion is a symptom of our way of life (Downs 20). In other words, it is a way for modern society to cope with the excess demand for road transport, especially during peak hours. To justify this view, Downs (20) says, “We need it! Peak-hour congestion is the balancing mechanism that makes it possible for Americans to pursue goals they value, such as working, while others do, living in low-density settlements, and having many choices of places to live and work” (21).

The Triple Convergence Effect

According to Downs (19), the least understood concept of traffic congestion as an urban problem is the concept of triple convergence effect, which argues that different regions often have self-adjusting transport systems that depend on the nature of route, time, and mode of transport. The entire concept of triple convergence acts as a system where various sectors of an economy adapt to changes in other sectors. In the context of our analysis, the changes mostly refer to specific changes in location, time, and travel modes. Downs (19) gives a hypothetical example of a situation where a major road is often congested every working morning because of excess traffic.

When authorities expand the road to accommodate more traffic, the traffic congestion problem would disappear the next day when the same number of drivers uses the same road. However, when word gets round that, traffic is free flowing, drivers who probably avoided this road for its congested traffic would come back to it and cause a new congestion (even with the increased road capacity). Similarly, people who had opted to use mass transit systems for commuting would also spill over onto the highways and compound the problem as well. Shortly, there would be a triple convergence problem in the city.

This reasoning explains the view of researchers who point out that peak-hour congestion cannot end on roads that have just benefitted from expanded capacity increase if they are part of a larger road transport network (Oxford Business Group 3). Nonetheless, Downs (19) clarifies that the principle of triple convergence does not undermine efforts to expand road transport networks because regardless of whether traffic rebuilds again, the same road would be carrying more cars per hour than the earlier situation when it was constrained.

The triple convergence effect explains the practicality of traffic management solutions. The principle of staggered work hours also exemplifies the principle of the theory because if workers are allowed to report to work during off-peak work times, there would be a free flow of traffic on major roads. However, once others realize there is a smooth flowing traffic, they are likely to join the major highways during this time and clog it back again. The triple convergence theory therefore provides a holistic conception of traffic management solutions.

Traffic Congestion is good for some cities and bad for others

Although many literatures point out that traffic congestion is not good for most cities, some researchers say it is bad for others. For example, Sweet (2088) has highlighted different situations where traffic congestion is good and bad for the city. His main problem is not identifying when such instances occur, but differentiating the two. When explaining the negative effects of traffic congestion, he says that the first order costs of congestion is the time taken staying in traffic and the extra fuel costs associated with immobile traffic (Sweet 2088). He also points out that second order costs of traffic are the costs of regional job growth associated with bad traffic conditions in a city (Sweet 2088).

This analysis shows us that although traffic is bad for most people when they are sitting in it, there are situations where traffic congestion is good the economy. To explore this issue, Sweet (2088) and Badge (2) conducted a study of metro areas in America for the period starting from 1993 and ending in 2008 where they analyzed the measure of traffic delay and travel capacity affected by traffic conditions.

The researchers used data from the Census Bureau and the Federal Transit Association to estimate the impact of traffic congestion on major metropolitan areas in the US. They also tried to control for other factors that would affect the economic growth of the cities, such as the educational levels of the population and workers’ skills. The reach of the transit infrastructure and the density of the jobs are other factors that the researchers considered when making this analysis (Badge 2).

Sweet (2088) used the city of Atlanta to explain the effects of these socioeconomic factors by saying that it could be easily affected by traffic congestion and the spatial disconnect between the number of available jobs and the availability of workers. To analyze the affect on the economy of the city, the researcher also highlighted the meager traffic service in the city (Sweet 2088). Although many factors influenced the transport system, the author tried to isolate the effects of these traffic-related problems on the economic performance of the city.

Generally, his findings appear counter-intuitive because they point out that higher levels of traffic congestion are associated with high levels of economic growth. However, past a certain level, an increase in traffic congestion would impede economic growth.

Researchers have strived to quantify the level of economic drag associated with traffic congestion and found out that traffic congestions that cause up to 37 hours of delay per commuter per years are likely to cause economic drag in an economy (National Cooperative Highway Research Program 20). This measure is similar to 4.5 minutes of delay per one-way trip. This time threshold is normally reached during days when there is heavy traffic congestion on major roads, throughout the day.

Badge (2) uses this threshold to explain situation where traffic congestion may be good for some cities because he points out that this threshold makes the computation of the economic effects of congestion difficult. Relative to this assertion, he says, “It means that congestion, in some cities, is more good than bad. And in other cities, it’s more bad than good” (Badge 2).

The National Cooperative Highway Research Program (20) says the estimates presented above are as close to causal as may be envisioned because it means that for most cities that do not experience heavy traffic congestion; congestion may actually emerge as good indicators of economic growth. Some observers have expressed their reservation with this statement after saying that the cost of solving traffic congestion problems may actually be higher than the cost of the congestion itself (Arasan 1; Eddington 2).

Relative to this assertion, Eddington (4) says that most cities, which do not have heavy traffic congestion problems, would be wasting public resources expending their road transport networks because this is not a priority for the smooth running of their economies. Therefore, unless the traffic problems of a city reach the tipping point outlined by Sweet (2088) (above), it is futile directing public resources towards fixing the problem. Therefore, if a city’s road transport authority directs its resources to expanding the road transport network or increasing its capacity in a different type of way, it is doing more harm to the economy than good.

The main premise of the above statement is that beyond the threshold described above (4.5 minutes), the quality of life for road users starts to decline and the economy starts to feel the pinch as well. Therefore, beyond this threshold, if road users spend more than an hour (or two) sitting in traffic, their lives would start feeling miserable and they would start demanding for more money to compensate them for their problems, or to make it worthwhile to go to work in the first place.

If their demands are not met, they may choose to go and look for another job, which is not a good outcome for employers because they would lose money through increased employee turnover and poor corporate image because of the same reason. Similarly, if traffic problems make it difficult for employers to match workers with their appropriate skills, their organizations would be operating inefficiently and this would lead to bad economic outputs for the country, or city, in question.

Badge (2) says the good news in this entire assessment, is that few researchers have found a threshold in traffic congestion metrics that would wholly stall and economy. In this analysis, the variables that most researchers have used to control for this relationship (such as the efficiency of the authorities in solving traffic problems, the demographics of a region, and the road network) are important to the economic functioning of a city, thereby making it impossible for them to end because of traffic problems. In other words, for economies to stop growing, a blend of all of these problems needs to happen at the same time. A good example of how these factors could affect the economic performance of a city is Detroit, which experienced sustained job losses for a long time. Relative to this observation, Badge points out that

“They have a perfect storm of a lot of things going on right now. In the study period, they were the only region that had any kind of sustained job losses, but that also exceeded these congestion diseconomy levels. But I don’t think you could argue that congestion in itself caused Detroit’s problems” (2).

What is the Relationship between Traffic Congestion and Economic Growth?

One of the most important issues that different governments consider when making investments in the transport sector is how their investments would yield a reduction in traffic congestion numbers. This issue has led different agencies in the transport sector to investigate the impact of traffic congestion on economic growth.

This concern transcends different international borders because in America, the American Association of State Highway and Transportation Officials (AASHTO) has expressed its concerns regarding the effects of traffic congestion on economic growth, while the RTA in Dubai has done the same (National Cooperative Highway Research Program 13). Regardless of the mode of transport used, the type of policy strategy adopted, or the region under analysis, it is difficult to make the right investment choices in infrastructure growth without first understanding the effects of traffic congestion on economic growth.

Past studies that have strived to investigate the relationship between traffic congestion and economic growth (Arasan 1; Eddington 2). They have pointed out the difficulty in understanding this relationship. The common approach used by many researchers is directly asking businesses the effects of traffic congestion on their enterprises. However, this approach is flawed because some of the businesses that have been severely affected by traffic congestion have either closed down or moved to a different location because of the problem (National Cooperative Highway Research Program 13). Furthermore, those that are operating in the areas affected by congestion are unable to provide accurate findings because they would have no basis for comparing their economic performance under a hypothetic scenario of no traffic congestion.

The Economics of Traffic Congestion

For many road users in Dubai and other major cities around the world, road traffic problem is a menace. While many of them may understand how it affects their daily routine, few people understand its economic impact on cities. In more accurate terms, researchers argue that its economic impact on cities is not straightforward (Hartgen 1). Nonetheless, few researchers dispute that the main problem of traffic congestion is wasted man-hours and delays to work. In other words, many people waste time travelling to work as opposed to working while at work. Other economic impacts may arise from delayed or missed meetings.

Relationship between Traffic Problems and Productivity

Hartgen (2) has highlighted the problems that exist with analyzing the relationship between traffic congestion and productivity by saying that this relationship is elusive. Although many researchers have undertaken different studies in Europe and the US, few researchers have highlighted the relationship between traffic congestion, accessibility, and urban productivity. Nonetheless, to demystify this relationship, different researchers have used varied approaches to test the concept of time and drive when evaluating the impact of traffic congestion problems on economic growth.

The result is drive time contour strategies that focus on evaluating the relationship between the number of entities (jobs, household, income and population groups) and the traffic situation in a region. However, independent analysts argue that the drive time contours appear to be a more effective analysis of the relationship between traffic congestion and access to economic hubs, as opposed to concentric circles in economic analysis (Hartgen 2). The drive time contour focuses a lot on the direction and speed of transportation. To explain the drive time contour, we analyze the figure below, which show the effects of traffic congestion on a 25-minute geographical area.

According to the diagram above, the enclosed area outlines a 25-minute drive time from the Denver CBD to the outlining areas. The traffic flow shows the traffic situation when there is congestion and when there is no congestion. There is a larger contour in the uncongested areas because cars move freely and people are easily mobile. If such free traffic flow occurs in areas that serve major routes, it translates to improved job opportunities for all, but mostly also for people who are within a 25-mile radius.

The increase in job opportunities should theoretically improve the economy of the region under study. The free-flowing traffic easily translates to more customers, increased movement of goods, and increased labor mobility. Therefore, the drive time contour mostly highlights changes to access to different factors of production. Particularly, they highlight how different cities are bound to grow and develop over time, bearing in mind the traffic changes. They also highlight how future improvements in road transport networks and traffic situation may influence access. Researchers have extended the application of drive time contours and used it to describe and compare the productivity of different regions (Hartgen 3).

Business Costs of Commuting

The purpose of classifying the business costs of congestion is to understand the economic costs of congestion. The value of such findings is to understand the economic costs of congestion beyond travel times used by commuters when traffic is problematic and similarly beyond the operating costs of vehicles. This analysis also evaluates business costs associated with an increase in traffic congestion problems and an increase in wage costs because of poor market accessibility, or any other negative factor caused by traffic congestion.

Before we delve deep into this analysis, it is pertinent to point out that different researchers have often relied on the traditional measure of travel time to evaluate the business costs of congestion, or the full economic value of the same to reduce traffic congestion (Oxford Business Group 3). The traditional approach often relies on understanding the effects of traffic congestion on wage rates and on the willingness of commuters to pay a premium for the convenience of enjoying a free-flowing traffic. This relationship emerges in the consumer behavior theory.

The derived values of travel choices depend on the choices made by different travelers regarding their travel plans. Nonetheless, a substantial volume of literature points to the fact that the cost businesses bear in terms of travel delay could be significantly higher than the marginal value of predicted time delay (Arasan 7). When analyzing the costs incurred by businesses, researchers have used different measures of analysis, including business production/delivery costs, business adjustment costs, and driver cost versus full business costs (Arasan 7). The same researchers have developed different theories for analyzing how businesses respond to bad traffic. The theory of capitalized commuting costs is one of them.

Theory of Capitalized Commuting Costs

Different researchers who have tried to explain variations in location patterns have used the theory of capitalized commuting costs to highlight differences in economic activities within a specific jurisdiction. For example, some experts have used the same relationship to highlight variations in economic prices (Oxford Business Group 3). Generally, under their theoretical framework, most households in an urban setting pay more for accommodation when there are low commuting costs. At the same time, this theory postulates that businesses would pay workers more money for high commuting costs if an area has bad traffic (National Cooperative Highway Research Program 13).

Variations in Wages across Different Metropolitan Areas

Researchers have only recently tried to explain the relationship between wage rates and accessibility. For example, a study conducted by Eddington (12) to investigate the relationship between wage rates and accessibility among Municipal Workers in the Chicago area found that there is a negative relationship between wage rates and distance from the CBD. Clarkson (5) conducted a similar but nationwide study on changes in wage rate for people who moved locations.

He investigated this relationship by assessing wages, occupations, and home-to-work distance and found that there is strong statistical evidence that people who change jobs also forfeit a significant portion of their wages (Clarkson 5). The forfeited wage rate often comes from changes in commuting costs. This relationship is defined by the fact that the higher the commuting costs, the higher the wages. Similarly, the lower the commuting costs, the lower the wages. The same theory also confirmed that the wage rates for suburban jobs are significantly lower than the wage rates for urban areas because the housing costs in suburban areas are lower than urban areas.

Other researchers have contributed to the same discussion by deriving a functional form of the wage gradient. This approach has allowed for a value of leisure time as well as commuting time. This finding also influences wage rates. For example, Smeed (34) has delved into this conversation by saying that wage rates should differ depending on the availability of a mass transit system in a city. Other researchers have clarified this statement and said that the availability of a mass transit system alone is not good enough to affect the wage rate (Oxford Business Group 7). However, the dependency on the same is more important in understanding how wage rates are affected because if people do not use a mass transit system (regardless of its availability), their wage rates are bound to be unchanged.

Hartgen (3) conducted a study to investigate the relationship between wage rates, commuting times, and housing prices and found that most employers pay higher wages if their workers incur high commuting costs. He obtained this finding by using information from the business payroll data of different businesses in Detroit. He matched the data with workers locations by using information from census tract for the larger Detroit area.

To estimate the relationship between wage rates and commuting times, the researchers used a regression analysis that controlled from different demographic factors, such as house quality, occupation, and race. Again, the findings pointed out that most employers are willing to compensate their workers for having to pay high costs of commuting. The researcher also found that this relationship was strongest among white people working in white-collar jobs (Hartgen 3).

It was so because the commuting time wage differential among this group of people was the biggest among different racial and job groups. In fact, a deeper assessment of this finding shows that the wage compensation rate among this population group was twice the average wage rate compared to other racial and job groups (Hartgen 3). This difference not only reflected the incremental value of time spent on the roads, but also the additional value lost if the same time was spent on undertaking leisure activities.

The same analysis pointed out gender differences in wage compensation for commuting time. Women were found to have lower commuting time wage differentials compared to men. In fact, it was just one-fifth of the median wage (Hartgen 3). This finding meant that most women were more concentrated in certain types of jobs, such as clerical jobs, compared to their male counterparts who had a wider selection of jobs to choose from.

Of particular importance to this analysis is the understanding that most workers who paid high housing costs also received significantly higher compensation for commuting to work. This observation is significantly consistent with previous research studies that have portrayed a trade-off between housing values and wage differentials attributed to traffic congestion (commuting times). Relative to this assertion, the National Cooperative Highway Research Program says,

“Overall, the findings to date suggest that it may be reasonable to expect no commuting time effect on wages outside of metropolitan areas and an effect within metropolitan areas that is slightly less than the full value of time reflected in wage rates” (26).

The wage rate premium offered by different employers for the high commuting costs often offsets the inconvenience caused by traffic congestion. Using this analogy, there is a minimal effect of traffic congestion issues on disposable income. The dynamics of the labor market also dictate how much employees would shift the burden of high commuting time and costs on their employers. Nonetheless, broadly, many researchers agree that the effect of traffic congestion on wage rates is often highest among white people working in white-collar jobs, as opposed to low-skilled workers who work in blue-collar jobs and the likes (Hartgen 3).

The implications of this assertion is the understanding that different employers are willing to pay different wage increments (compensation) for commuting times, but their willingness to do so often depends on differences in location. These studies also reflect the extent to which different employees incur transportation costs for their commute to work. Therefore, a huge body of literature affirms the fact that employers and businesses pay a lot of money for congestion. This increases their cost of doing business.

What are the Different Ways of Measuring Congestion

Owing to the different effects of congestion on the economic growth of different regions, different researchers have dedicated a lot of time developing unique measurement systems for understanding the impact of congestion (National Cooperative Highway Research Program 13). The trouble exists on this side of the relationship between traffic congestion and economic growth because there are already different measures used to estimate economic growth. Different countries have adopted unique measures of measuring congestion indices. For example, Hartgen (4) says some of the most common measures used in America are Highway Statistics and National Transportation Statistics.

However, the existence of these measures does not negate the fact that different metrics exist for measuring congestion on roads. Some of the existent methods measure congestion consistently with the definition of the same concept. For example, there is a congestion index tied to travel rates. This measurement index is often used in different research projects, including most projects done by the Texas Transportation Institute (Hartgen 3).

Some jurisdictions use the excess delay measure for assessing the impact of traffic congestion on economies. This measure uses the amount of time commuters spend on an intersection or along a specific road. Using this metric, they point out that whenever the time commuters take exceeds a certain level of service, the effects of the congestion would be severe; if it is below this level of service; the effects are bound to be lesser (National Cooperative Highway Research Program 13). The last common measure for assessing traffic congestion is defined by the percentage of time at a specific point on a highway. If the average speed falls below a specific threshold, the effects of traffic congestion are severe, while if it exceeds a specific speed point, the effects are lower.

Different types of transport agencies use many of the measures of traffic congestion described above to evaluate the system performance of their transport networks. Broadly, these measures outline five distinct criteria for evaluating the effects of traffic congestion. They include time-related factors, volume-related measures, congestion indices, delay measures, and level of service measures. We investigate these measures in more intricate details below.

Time-Related Measures

According to the National Cooperative Highway Research Program,

“Time-related measures refer to an output of the traffic assignment process of travel demand modeling, defined as the estimated time necessary to travel from an originating zone to a destination zone of a given highway network. These travel times can be estimated by calculating minimum time path skim trees” (11).

Time-related measures are often reliant on travel times to assess the impact of traffic congestion on commuters. Many researchers prefer to use this metric because it applies to all forms of travel and allows different types of people to use it (it is simple to use) (Smeed 33). Many vehicle intelligent highway systems use the time metric to assess traffic congestion problems. For example, Houston’s Real-Time Traffic Information System, uses this time measurement metric to assess traffic congestion by adopting cellular telephone reporting systems to find out that time that commuters spend on the roads (Hartgen 3).

The TRANSCOMM Electric Toll and Traffic Management Project in New Jersey also uses the same type of system, but also adopts vehicle identification techniques to come up with a proper assessment of the time taken on traffic (Hartgen 3). However, the use of this technology mostly applies to the assessment of specially tagged vehicles on a specific transit route. Based on its widespread use and adoption, many people consider the time measure of traffic analysis to be the best measure of road traffic congestion (National Cooperative Highway Research Program 11).

Volume Measures

Assessing traffic patterns through volume measures involves understanding traffic volume counts and the kilometers travelled by commuters. Researchers use this measure to assess traffic congestion because they believe that the volume of traffic is commensurate to the demand of road transport (Smeed 33). This demand is often comparable to the supply available. In the context of this study, the supply available is determined by the capacity of the existing road network to accommodate the demand.

This relationship (between the demand and supply of road transport) is often defined by the volume-to-capacity ratio. Hartgen (6) contributes to this analysis by saying that the distance traveled by a vehicle is not a reliable measure for assessing traffic congestion, if it is used by itself. Owing to this caution, some researchers use the concept of density to assess traffic congestion problems because it is a function of both volume and speed of travel.

Eddington (2) contributes to this discussion and says that real-time monitoring systems could be useful in the correct assessment of travel rate. It could also provide a reliable measure of congestion levels and the movement of goods. Similar to other measures of traffic congestion, the data obtained from using this type of traffic measurement should be recorded in a simple and cost-effective manner. Doing so, would help data users to make comparisons about changes in performance over an extended period. The same system is useful for providing data on system utilization.

Congestion Indices

Most researchers who have used the congestion index to estimate traffic congestion problems are US-based (National Cooperative Highway Research Program 11). Consequently, their work has aided in the comparison of congestion among US cities. Although congestion indices may provide accurate assessments of congestion in a busy city, it is relatively unreliable when evaluating regional congestion. Similarly, its effectiveness is low when evaluating the rate of congestion across different modes of transport.

To solve some of the inherent challenges of this mode of transport, researchers have strived to improve congestion indices to make them applicable when analyzing different modes of transport (National Cooperative Highway Research Program 11). To make such improvements, researchers have introduced the volume/acceptable flow rate into different traffic congestion measures. In practical terms, they have used the flow rate and measured it against local characteristics of a specific road to come up with a reliable assessment of traffic congestion. Commenting on this approach, the National Cooperative Highway Research Program says,

“This index is based on the travel rates of all travel modes multiplied by the VMT for each mode and then divided by freeway VMT plus arterial VMT, adjusted to reflect roadway classification variables (derived from local information). Other indices of congestion such as excess delay are also being proposed at the regional level” (13).

The road congestion index is a common type of index used to evaluate traffic congestion because it is system-wide, in the sense that authorities have used it to assess traffic congestion in streets and freeways (Oxford Business Group 3). A different technique for measuring traffic congestion within this subcategory is the roadway congestion index. It often uses the number of kilometers travelled per car using an empirical formula. To explain how it works, the National Cooperative Highway Research Program says,

“The index equation weighs the daily VMT per lane mile values for the two functional classes by their respective daily VMT, which is then normalized by daily VMT per lane miles representing the threshold of congestion (LOS D or worse)” (13).

Measures of Delay

According to the Oxford Business Group (3), delays caused by traffic jams often increase travel times and significantly reduce the speed commuters would use to travel from one point to another. Based on this understanding, different measures of delay often tie to different measures of time. This metric of assessing travel conditions is often important when striving to analyze specific traffic congestion problems.

For example, Mason (97) says they could be instrumental in identifying recurring or non-recurring traffic congestion problems. Researchers who have dedicated their time to evaluate non-recurring traffic congestion problems say that it is important to have reliable data regarding incident-related delays (Eddington 12). They also emphasize the importance of understanding the benefits that can be derived from their reduction. The same researchers have used different criteria to analyze the concept of delay (Eddington 12). However, the most common measure used is understanding the desired flow of traffic and the actual time travelled.

This definition is appropriate when analyzing traffic congestion problems in areas where there is high congestion and in areas where authorities are analyzing the traffic congestion of an overall system. Nonetheless, it is important to point out that this measure does not outline the main causes of congestion. Some researchers have used a different criterion for analyzing the measures of delay. They have pointed out that the best metric for assessing traffic congestion this way is by analyzing the minute kilometers of delay (Hartgen 8).

This value is got by analyzing the length of the road under analysis and multiplying it with the difference between the acceptable time taken to travel from one point to another and the actual travel ratio. Commonly, the actual travel ratio is equivalent to 60 minutes. This figure is divided by the speed commuters use on the segment of road under analysis.

Lastly, other researchers have used the concept of level of service to explain how authorities can use delays as a reliable measure for assessing traffic congestion. To expound on the use of this metric, the Highway Capacity Manual used in America says, “the concept of level of service” is defined as a qualitative measure describing operational conditions within a traffic stream and their perception by motorists and passengers” (National Cooperative Highway Research Program 13).

Problems Associated with Computing the Economic cost of Traffic Congestion

As mentioned in the first chapter of this report, the economic impact of traffic congestion is difficult to estimate, or even compute. Many researchers have not only affirmed this fact, but also presented different reasons for this. For example, Mason (97) pointed out that additional cost factors have made it difficult for researchers to estimate the economic cost of traffic jams in major cities worldwide. This view stems from the fact that traffic congestion problems have economic costs that stretch far beyond the cost of running a vehicle, or the time delay associated with moving people from one point to another.

Therefore, several additional costs are associated with traffic congestion, such as inventory costs, logistics costs, and reliability costs. Based on the findings identified in the first chapter of this report, we have also found that just-in-time processing costs, market reduction for workers, market reduction for customers, and incoming/outgoing deliveries are also other economic costs associated with traffic congestion problems.

Business adjustment is another factor that makes it difficult for experts to estimate the economic cost of traffic congestion because many businesses often adjust to traffic congestion problems in different ways. For example, some of them move away from the affected areas, others close down, while more move to smaller markets. Most of these adjustments often result in the loss of productivity (Mason 97).

Researchers who have strived to estimate the economic cost of congestion using qualitative research methods by interviewing business leaders in different parts of the world have come to the same conclusion (National Cooperative Highway Research Program 27). They found that most of the businesses that were severely affected by traffic congestion either closed down or moved away. Those that were still around had changed so much, such that the existing workers did not have an idea how the business would be if there were no traffic congestion problems. Based on these challenges, the National Cooperative Highway Research Program (27) says the best way for businesses to understand the economic cost of traffic congestion is by using economic models.

Conceptual Framework

Based on the above-mentioned findings, we will use the business production functional model to understand the relationship between traffic congestion and the economic growth of Dubai. This conceptual model has three main tenets. We discuss them below.

Business Markets

This tenet of the conceptual model postulates that some businesses have one establishment, or a few establishments, that serve a wide area, while other types of businesses have many establishments that serve small selected areas (National Cooperative Highway Research Program 20). This fact emphasizes that different businesses have different patterns of operation characterized by unique worker (occupation) needs and supply (commodity) needs. These variables are also representative of different product or service delivery markets that also characterize unique business dynamics. Nonetheless, collectively, the aforementioned factors reflect the different types of specializations that characterize the delivery, or manufacture, of products from one location to another.

Business Production Functions

This tenet of analysis proposes that the effects of traffic congestion on different businesses depend on the effects of traffic jams on direct travel-related costs and production costs. Their ability to adjust to smaller markets also affects the same relationship. Collectively, these variables outline the dependency of businesses to the access to specialized workers, or factors of production (National Cooperative Highway Research Program 20).

Business Mix

This tenet of the conceptual framework brings our attention to the different kinds of businesses that each city has. Based on the unique types of businesses available in a specific regional area, different cities have unique need requirements for their access to specialized workers, specialized materials, or other factors that affect their production.

Summary

Based on the findings presented in this chapter, we find that our relationship with traffic is often undisputed – people do not like bad traffic. This is why we also do not like some of the synonyms associated with traffic congestion, such as “congestion” and “gridlock.” These sentiments are justified because traffic congestion often causes a tremendous inconvenience to many people. We have highlighted this fact in the first section of this chapter.

However, the relationship between traffic and the economy is often not as straightforward as the relationship between people and traffic congestion. The complexity of the relationship between traffic and congestion and the economy is complicated enough that most researchers have not entirely given a proper explanation for it. The findings presented in subsequent chapters would strive to fill this research gap.

Research Methodology

Research Approach

There are two main research paradigms – qualitative approach and quantitative approach. In the proposed study, I intend to use a collection of both –mixed methods approach. This strategy would help in triangulation of data to safeguard the reliability and validity of the information obtained from the findings.

Research Design

There are six different types of research designs to use in the mixed methods research approach. They include sequential explanatory designs, sequential exploratory design, sequential transformative design, concurrent triangulation, concurrent nested technique, and concurrent transformative technique (Zikmund 18). I intend to use the concurrent triangulation technique because it allows the researcher to use two, or more, techniques for cross-validation of data (Biddix 5). In other words, the data collection is concurrent because multiple methods are used to overcome the weakness of one other.

Data Collection

The data collection process would involve the collection of primary and secondary data. Primary data would emerge as expert findings. Stated differently, I will collect data through interviews of experts and professionals in the research field. I would also collect secondary data from credible published sources of information, such as books and journals. To get accurate and quantifiable results in this study, we asked the respondents to state their views regarding the traffic congestion problems in Dubai by explaining their views on drive time along the major highways of the city and not necessarily the local roads.

The main aim of doing so was to stick the economic focus of this study, which is to evaluate the impact of traffic congestion on the economic growth of Dubai. Most of the economic centers in the city are interlinked with major highways and not necessarily access roads or local roads. Therefore, we strived to limit the respondents’ views to these highways. The interview questions focused on evaluating significant questions that reflected this focus (see appendix one).

Data Analysis

The data analysis process included the thematic coding technique. It allowed the researcher to record and identify passages, or texts, that present a common theme or idea in the research. This way, the researcher would have a framework for data analysis. Since it was impractical to compute how traffic congestion would affect the mobility of millions of people who live and work in Dubai, we had no option but to narrow down the field of location to a few economic centers in the city.

In other words, these economic centers were pivotal to the emirate’s economic growth. In our assessment, the major economic centers were the Dubai airport, downtown (central business district), and the industrial zone. It is important to point out that these economic centers are not the only ones central to the economic performance of the region. These regions are only essential to our analysis in the sense that they are indicative of the economic centers that allow the region to function economically. They also outline the main economic hubs where visitors to Dubai would choose to visit in their local travel.

The next step in our analysis involved quantifying the current and future volume of traffic that would characterize Dubai’s traffic situation in the future. The year of analysis is 2030 because most cities including Dubai have a projected plan of development using the same year. Using this period, it was easier to estimate how free flowing traffic and the ease of traffic flow would affect the economic performance of the Emirate. This paper significantly relies on a 25-minute time radius as the standard practice for conceptualizing efficiency in the road transport network. However, this time measure has limitations in the sense that it fails to capture the larger area of the transport system in Dubai.

In other words, Dubai is a larger metropolitan area and most of the economic activities of the region cannot be covered within a 25-minute economic radius. Using a larger catchment area that would possibly expand the time scope standards for analyzing efficient traffic could possibly increase the credibility of our modeling results. Based on this suggestion, it is important to point out that the findings of this paper refer to evaluating the effects of congestion, such as slower travel times and wasted economic outputs within a 25-minute drive time.

Findings and Analysis

Introduction

In this paper, we conducted a rigorous analysis of the research findings obtained from the primary research process and the secondary research process. An extensive process of data assembly and an extensive statistical model analysis for the city of Dubai, as one large metropolitan region, characterized both research processes. The analysis models were important to our analysis because they helped to identify the sensitivity of different business activities to traffic congestion problems. A critical part of our discussion of the research questions in this study pivoted on the findings we got from this analysis. The findings of the secondary literature review and the primary research appear below.

Secondary review Findings

Main Causes of Congestion in Dubai

The major transportation hubs of Dubai are considered some of the main drivers of the Emirate’s economic success story that has caught the world’s attention in the last decade. The government has largely tried to sustain Dubai’s economic success story by building more highways to link different metropolitan areas in Dubai to the central business district and construct major seaports to boost the volumes of international goods coming and leaving the Emirate (UN Habitat 66). Some of the major seaports built in this manner include Port Rashid and Jebel Ali Port. The Dubai International Airport was also built with the same goal in mind.

The construction of these transport hubs has augmented the possibility of economic activity in the region by increasing the profile of Dubai as one of the major economic hubs of the Middle East (Gulf News 1). Owing to the increased profile of the city as one of the region’s main economic centers, high traffic congestion has caught many people by surprise because it is expected that with a city of Dubai’s stature, it would not suffer from the perennial traffic congestion problems that continue to bedevil it.

Generally, the UAE has an elaborate road transport network that links different Emirates with one another. These transport networks also link the country with other GCC states in an effort to improve regional connectivity in the Middle East.

Most of the traffic congestion problems in Dubai occur around bottleneck areas in the city’s transport network. At the same time, there is a problem in the country’s public transport network because it is mostly reliant on bus transport, which cannot cope with the demand for public transport. Based on this observation, it is common to see crowded buses in a few routes within the city. Researchers have touted different reasons for the poor state of public transport system in Dubai. Most of them say the problem rests with poor management styles, poor quality planning, and unclear contractual obligations among different stakeholders (Gulf News 1).

The Road Transport Authority is the main government body mandated to sort road transport issues. The same entity is tasked with the duty of managing the city’s public transport bus service. The routes followed by the buses ordinarily cover the whole length and breadth of the city. Nonetheless, there are different reasons why Dubai residents suffer from the serious traffic management problems in the city. One of the main causes is the rapid population growth in the city. The rapid increase in population numbers has not only increased the demand for public transport system, but also increased the number of trucks and cars on the road.

Although most major trucks that ply Dubai routes move in slow traffic, Arasan (1) and Eddington (2) say, the major problem causing the road transport problems in Dubai is the ageing road transport. Consequently, the city’s road infrastructure network is unable to accommodate long fleets of vehicles that often ply major highways. According to some researchers, most of Dubai’s traffic problems have emerged because of the failure by authorities to anticipate the city’s future traffic needs (UN Habitat 66).

In other words, the city’s road transport plan has failed to live up to its purpose as major road transport improvements have only led to a worsening of the traffic problem; instead of an improvement on the same. For example, the construction of overpasses across the Sheikh Zayed Road has forced major traffic to spill over into major highways. The traffic is often cross-town or local.

Reckless or irresponsible driving is another cause of traffic problems in Dubai. This cause of traffic congestion has not only led to the worsening of traffic problems, but also the loss of thousands of lives every year. Statistics reveal that reckless driving is responsible for 38% of traffic problems in Dubai (UN Habitat 66-67). The death rate in Dubai is 64% because of these traffic accidents (UN Habitat 66-67). This percentage is four times that of Britain (Eddington 4).

The basic design of Dubai roads is also seen as another cause of road traffic problems in Dubai. Particularly, the construction of roundabouts along major highways and intersections is a major cause of traffic congestion in the city because it creates bottlenecks in the city’s road transport network, The negative effects of roundabouts on the city’s road transport system particularly emerge during peak and off-peak times. Based on these observations, some researchers have pointed out that Dubai’s road transport problems could end by changing the design of the city’s road transport network.

Effect of Traffic Congestion on the Economy of Dubai

According to Mason (97), traffic congestion problems have cost the Dubai economy more than Dh2.9 billion. This cost translates to losses in terms of lost working hours, time and fuel wastage. By most standards, this cost is huge, especially considering the same amount of money could have been used to finance investments for residents of Dubai to use it on their family and friends. The time wasted could also have been used to undertake activities that would generate more money for their families or the economy at large.

Mason (97) divided the monetary losses stipulated above with the total length of roads in Dubai and found out that economic cost of congestion in the city is Dh771,147.388 per kilometer. Nonetheless, many observers say the situation could have been worse if it were not for the intervention of the RTA (Gulf News 1). The RTA has undertaken massive infrastructure developments, in terms of building roads, bridges and expanding the existing road network. The introduction of the Dubai Metro is a good example of the kind of work the RTA has been doing. Generally, this government agency has spent close to Dh60 billion for infrastructure developments (Gulf News 1).

Possible Solutions to the Traffic Congestion Problems in Dubai

According to estimates by Dubai’s RTA, if they did not undertake the infrastructure investments completed so far, the cost of traffic congestion in Dubai would reach a staggering Dh100.4 billion (Gulf News 1). To support its activities, the agency says that it is looking to emulate international best practice in managing traffic congestion problems in the city. According to a representative of the agency,

“The current international trend is to optimize the efficiency of existing transportation infrastructure and services with high emphasis on developing safe and environmentally sustainable transportation systems which basically depend on mass transit options rather than private cars to provide the mobility requirements of cities and communities” (6).

In line with the recommendations of the International Association for Public Transport, authorities should double down on the share of public transport for the sustainable management of road transport (Gulf News 1). Relative to this assertion, Hartgen (3) points out that the true solution to managing public transport is not really to increase or expand the capacity of the road transport network, but to increase the efficiency of the existing system and to introduce alternative mass transport systems.

For example, he points out that introducing bus lanes in the city would increase the efficiency of road transport services and encourage more people to use this form of public transport as opposed to buying cars for self-drive (Hartgen 3).

In addition to increasing the efficiency of existing public transport networks and introducing public transport systems such as the Dubai Metro, Downs (20) points out that promoting the culture of car-pooling would also go a long way in reducing traffic congestion problems in Dubai. Some developed countries, such as the US and France have recognized this fact and have promoted such a culture with dedicated high occupancy vehicle lanes. They have also dedicated certain parking spaces for this group of commuters. Recognizing such recommendations, the RTA expects to continue making infrastructure investments in Dubai with annual expenses that exceed Dh5 to Dh7 billion annually (Gulf News 1).

What about Expanding the Road Infrastructure?

The effects of traffic congestion in Dubai and other major cities around the world have spooked many transport stakeholders into developing sustainable solutions for managing this problem. Their efforts are everywhere. For example, on one front, carmakers have tried to develop efficient vehicles to minimize gas consumption and reduce the volume of greenhouse gas emission by tweaking engines. While these efforts are noble and are aimed at reducing the environmental impact of car use, little progress has been made because the production of smaller and efficient cars has only resulted in more car sales for the manufacturers (National Cooperative Highway Research Program 27).

The Oxford Business Group (3) says part of the problem stems from the positive relationship between car ownership and economic growth. In other words, the higher the rate of economic growth, the higher the rate of car ownership. This relationship is often unavoidable and difficult to legislate because with increased economic growth is an increase in purchasing power and a similar increase in car ownership. Nonetheless, as we have seen in the first chapter of this paper, economic growth comes at a price – traffic congestion. Interestingly, if left unchecked, it starts to choke the economy again, thereby slowing the rate of economic growth.

Since the rate of population growth continues to surpass most metrics of capacity growth, it would soon be untenable for Dubai and other major cities to sustain their road transport system. In the past few years, Dubai mostly focused on increasing the capacity of its road transport network. However, this strategy has not had much success because of the triple convergence effect, which shows that traffic congestion is an unavoidable phenomenon in most growing metropolitan areas of the world. To explain this view, Downs says, “Peak-hour traffic congestion is a result of the way modern societies operate, and of residents’ habits that cause them to overload roads and transit systems every day” (19).

Relationship between Congestion and the Economy in Dubai

Part of the objective of our analysis was understanding the relationship between traffic congestion and the economic growth of Dubai. We required an abstract structure of how these variables would influence each other. Through a review of the nature of Dubai’s transport network/industry and the economic performance of Dubai in the past few years, we found that five factors affect congestion and its economic impact on the city. They are

• Transportation-related investment and pricing
• Transportations system performance
• Business market accessibility and location costs
• Economic Productivity (production costs)
• Regional economic expansion/contraction (output, income, and jobs)

Generally, the items highlighted above represent a progression of steps for analyzing the relationship between traffic congestion and the economic growth of Dubai; however, this progression is theoretical because in reality, this relationship may be much more complex. However, before delving into the details of this analysis, it is pertinent to understand how the different elements interact with one another theoretically. We explain this relationship using the diagram below.

In this paper, we assumed that the supply and demand of the transportation system in Dubai are represented with the first and second boxes. They outline specific scenarios where traffic congestion may occur. The third and fourth boxes outline unique alternative transportation scenarios that emerge from the changes in transport conditions, which may affect the costs of doing businesses in Dubai.

The last box refers to how these changes in transport conditions could lead to significant changes in the regional competitiveness of the Emirate, relative to other regional economic hubs in the Middle East. A regional economic forecast model could best explain how the long-term traffic congestion of Dubai could affect its competitiveness in the long-term.

When we compare the above findings to other studies, we find that past studies have failed to highlight the intermediate elements of changes that affect the transportation systems. They also fail to show the relationship between system performance and accessibility changes in the transport system with the economic growth or performance of the region. The limitations of these studies are that they fail to give us a platform to assess how the economic growth of Dubai has improved because of the improved accessibility of rural regions to investors.

They also limit our ability to understand the extent of economic growth that has occurred because of interstate connectivity and the reduction of urban congestion. Nonetheless, in this study, we mainly concentrated our attention on understanding the effects of traffic congestion on major urban areas. This analysis is represented by an overview of the information contained in the second, third and fourth boxes highlighted in the above diagram above. Comprehensively, the findings complement the data found in aggregate studies that have investigated the productivity of the Dubai economy, based on the behavioral changes of local businesses, relative to the transport conditions.

Differences in Industries

In our analysis, we found out that different industries in Dubai had unique requirements that characterized their sensitivity to traffic congestion problems. For example, we found out that industries, which had a broad base of worker requirements, were less sensitive to traffic congestion problems as opposed to those that had a narrower worker base. Industries, which had a higher level of truck shipments also absorbed the high cost, associated with congestion easily (National Cooperative Highway Research Program 23).

The same industries mentioned above were more likely to benefit from reduced rates of congestion compared to those that did not share their characteristics. According to the production function model, different industries in Dubai had unique industry-wide effects of productivity, which is caused by traffic congestion issues.

Our analysis showed that most industries, which did not depend on highly skilled labor for production tended to suffer fewer effects of production because of traffic congestion. Similarly, we found out that firms, which could work with non-specialized input requirements, also enjoyed the same advantage. Similar to the response above, these two groups of firms also tended to post the least benefits accruing from an ease of traffic problems. Conversely, firms or industries that require specialized input for operation, or highly skilled workers for operation, were the most affected by traffic congestion, but stood the most to benefit if the traffic congestion problem ended.

Our findings also revealed that traffic congestion in Dubai tended to reduce the agglomeration benefits that have always been characterized with the Emirate. These benefits have been eroded by the fact that the city’s traffic congestion problems have reduced the access to specialized labor and delivery markets. Consequently, most of them have been forced to adjust with shorter delivery times because this is the only way to cope with the problem.

Stemming from these characteristics, businesses that rely on specialized labor and access markets tend to suffer the most when traffic congestion increases. Similarly, they stand to benefit the most when authorities solve this problem. The concept of scale also emerged as another point of discussion in our review because we found out that traffic congestion problems could negate some of the positive effects associated with doing business in Dubai. The use of the labor cost model adds to this discussion by showing that increasing the effective labor size (by 200%) could cause a 6.5 increase in firm productivity.

A review of the above findings revealed that the effects of traffic congestion differed across different places. The differences come from understanding the economic profile of the region under analysis and identifying the business location pattern that defines the resilience, or vulnerability, of a firm or industry to traffic congestion problems. Indeed, the case study highlighted in this paper illustrates how congestion could affect different types of industries, depending on the extent of the congestion.

Generally, an assessment of our findings reveals that to understand the effects of traffic congestion in the economic growth of Dubai, we had to evaluate four scenarios. Scenario 1 was investigating traffic congestion in the Dubai’s metropolitan area. The second scenario involved investigating traffic congestion in the central business district. The third scenario involved investigating the effects of congestion on the older working class and the industrial areas of the city. The last scenario involved investigating the effects of traffic congestion on white-collar commuter areas of the city.

When we analyzed the effects of traffic congestion on the CBD, we found out that the economic effects of the congestion differed, depending on which roads were affected. For example, when congestion was concentrated in the central area of the CBD, only those businesses that operated in the zone were most affected. The reason for this outcome was the service-oriented nature of most businesses operating in the CBD.

Most of them relied on incoming deliveries of supplies and other materials needed in their service delivery goal. Comparatively, there were few outgoing trucks from this location. An analysis of traffic congestion around the industrial areas of Dubai showed that the economic benefits and disadvantages of traffic congestion were distributed evenly across industry players. This outcome could be justified by the fact that most firms operating in the industrial zones had many outgoing trucks. Since most of them serve other businesses, a delay in traffic would evenly affect all the businesses that depend on such shipments. Therefore, the same factor would affect businesses in the CBD and other outlying fringe areas.

When we look at how traffic congestion problems affect region-wide worker commuting delays, we find that the severity of traffic congestion problems in this scenario were also dependent on the location of where the congestion occurred. For example, when there was a general reduction in traffic across a region (uniformly) those businesses that were located at the periphery of the metropolitan area were bound to enjoy the most benefits that would accrue from such an action.

This outcome could be explained by the fact that most businesses located within these regions are usually the ones most affected by longer travel distances. For example, trucks that deliver goods or materials to these businesses are likely to suffer the most from the long travel distances. Consequently, increases and decreases in congestion costs are bound to have the greatest impact on their operations compared to trucks that supply goods to other types of businesses.

Lastly, when we look at the commuting delays for outlying residential areas of Dubai, we found out that when the traffic congestion problem was concentrated on areas that were inhabited by expatriates, or people with skilled labor, its negative economic effects would be felt across different aspects of the emirate’s economy (where they work). The distribution of the negative effects of would be even. Therefore, businesses that mostly relied on the contribution of executives to succeed and those that used precision-skilled workers to achieve good results were bound to show the greatest vulnerability to traffic congestion problems in the Emirate.

From these findings, we learn the estimated costs of traffic congestion in Dubai depend on the specific scenario under analysis because the test scenarios used in this study ranged from $10 million annually to $500 million annually. These costs are associated with product and service delivery within different zones of Dubai. The changes associated with business costs for the year also ranged from $1 million to $2.8 million annually.

The findings of this study would significantly rely on the concept of accessibility as the main metric for justifying the findings. In this evaluation, accessibility refers to the ease through which workers or commuters would reach their workstations or destinations within a 25-minute time window. As mentioned in this paper, the 25-minute period was chosen for this study because it is a correct approximation of the media peak-hour time travel for commuters and workers in different major cities around the world.

The time metric is also recognized internationally as an accurate measure of defining or comparing the traffic situation in different regions. This straightforward characterization therefore best represents the correct metric for investigating the relationship between traffic congestion problems and economic growth.

Making significant infrastructure investments in Dubai’s road transport network would increase its capacity and possibly permit higher free-flowing speeds. Therefore, people can move around in about 25 minutes. This period mostly applies to people’s movements along major traffic routes and not necessarily roads that do not have a high traffic. The increase in traffic flow would amount to increased job opportunities for residents living within a 25 minutes travel distance to their places of work. The city’s economic performance would increase in the same fashion because of reduced travel time. An increase in the jobs available for citizens and an increase in customer traffic or the inflow of workers willing to work in different factories would yield the same result.

Worker Costs

An analysis of employee costs was significant to our analysis because we found out that both the secondary literature review process and the interview process frequently mentioned the cost of labor as a significant indicator of the cost of traffic congestion on the economy. Relative to this observation, the Oxford Business Group (9) says that when analyzing the effects of traffic congestion on the cost of doing business in Dubai, it is pertinent to understand that labor costs often incorporate two elements.

The first one is the amount of money workers are willing to pay for their contribution to an organization and the second one is the amount of money employers are willing to pay to their employees for the extra time and money used to commute to work.

Depending on the type of industry in discussion and the nature of work involved, employers may have different elasticity of substitution of workers. For example, employers who mostly work with low-skilled workers often have a higher elasticity of substitution, while those who work with highly skilled workers have a lower elasticity of substitution. Similarly, businesses, which have a lower elasticity of substitution and depend on the availability of skilled labor often search a wide geographical area for workers, while those that depend on low-skilled workers often search a smaller geographical area for workers.

This analysis has an implication on our analysis of the effects of traffic congestion on the economic performance of the UAE because businesses that often depend on highly skilled workers are bound to be easily affected by traffic congestion problems. Meanwhile, those that depend on low-skilled workers are relatively more immune to traffic congestion because the workers would come from a smaller geographical area. Businesses that depend on highly skilled workers are therefore bound to be easily convinced to pay extra money for the transportation of the highly skilled workers compared to those that depend on the input of low-skilled workers.

Delivery Cost

The delivery cost of different products affected by traffic congestion stems from an analysis of two aspects of product cost. The first one is the initial cost of the product and the second one is the cost of transporting the goods from the factory or shop to the customer. Different supplier choices impose different levels of elasticity of businesses. The elasticity mentioned refers to the sensitivity of businesses to different cost profiles.

Businesses that mostly produce specialized products have a lower level of elasticity of substitution, while those that do not deal in specialized products do not have a high level of elasticity. Businesses that mostly specialize in specialized products often have customers who are willing to pay a premium for the delivery of goods to their doorstep because such products are often available over a wide geographical area.

Comparatively, businesses that often sell generic, or common, products do not enjoy this advantage because they goods are commonly available and their customers are often unwilling to pay a premium for the delivery of the same goods to their doorstep. This analysis means that most customers want to pay for goods and services that are convenient. Therefore, they are likely to shun products or services that are not available to them, or inconvenient for them to get.

Problems associated with Assigning Traffic Congestion Costs to Industries

There are unique problems associated with assigning traffic congestion costs to businesses. This analysis brings our focus to understanding fundamental differences in how businesses incur congestion costs in Dubai. Mostly, this analysis is true relative to worker commuting costs and the costs of delivering goods and services to their customers. As we have mentioned in this report, traffic congestion often affects the costs of obtaining workers.

This is a significant input for most businesses because people are central to the efficient operations of any organization. The process of obtaining workers during times of traffic congestion could occur when compensating for direct costs and the process of assessing the impediments for the access to a variety of products in the market. When we analyze the cost of delivering products and services to the market, we specifically look at how traffic affects the net delivery of products and services in the market. In this analysis, we investigate an output component of Dubai businesses. This analysis occurs in the context that transportation costs are included in the final costs of products delivered to customers.

Interview Responses

Which areas of Dubai are likely to be affected by Traffic Congestion?

The interviewees were asked to state which economic centers of Dubai were likely to be affected by traffic congestion. Two of the experts said that the CBD and the international airport were the most important economic hubs to be affected by traffic congestion. When asked to justify their criteria for choosing this economic hub, the respondents said the transportation hub is the gateway to the Dubai economy in the sense that most tourists and businesspeople visiting Dubai use this airport to come into the city. The UN Habitat (68) supports this finding by saying that the Dubai Airport is a leading economic hub not only in the UAE, but also in the wider Middle East region.

Situated in the Al Garhoud district, the airport serves more than 65% of business and leisure travelers in Dubai. Based on these findings, it is difficult to ignore the economic contributions of the Dubai Airport to the Emirate’s economy because more than 90,000 people work here. Experts estimate that the economic contribution of the Dubai International Airport is more than $26 billion (UN Habitat 68). This figure represents more than 27% of the GDP of Dubai.

It also accounts for 21% of the employment sector in Dubai. By 2020, the economic contribution of the Dubai International Airport to the Emirate’s economy is bound to increase to 37.5% (Gulf News 5). This estimation also points out that the international airport is bound to contribute $88.1 billion to the economy and support close to 2 million jobs by 2020. By current metrics, if the economic contribution of the airport increases to this magnitude it would account for 44.7% of GDP and 35.5% of the total employment opportunities in Dubai (Gulf News 8).

These statistics demonstrate that the respondents were right in singling out the Dubai International Airport as a main economic center in Dubai. Traffic congestion along routes that serve the airport is bound to affect not only the economic activities in the facility, but also the economic activities of the Emirate. Relative to this assertion, one of the respondents said most people who are travelling along Sheikh Zayed Road suffer from perennial traffic congestion problems when they are trying to access the airport. Commuters who use Sheikh Mohammed bin Zayed Road also suffer from the same traffic problem because traffic congestion starts from the airport all the way to Maliha Road.

What Types of Costs are often affected by Congestion?

In the second question of our analysis, we asked our respondents to state the kinds of costs that are often affected by congestion. Most of the respondents said that market access costs are the most common types of expenses affected by an increase in congestion in the city. Some of the respondents also said that employee costs were also significant expenses that employers incurred when congestion increases.

These views reflected most of the assertions of different researchers highlighted in the literature review section of this paper because many experts documented how high commuting times increases the costs of employers’ wage burden because they have to compensate some of their employees for the extra burden of paying high transportation costs. One of the respondents contributed to this discussion by saying that the greatest effect of traffic congestion is the accessibility of obtaining business inputs.

He was not specific about which business inputs he was talking about, but he mentioned that supplies and workers were the biggest business inputs for Dubai-based businesses because of their service-oriented nature. To support this assertion, he said that the delivery cost of finished goods was a significant cost burden for customers and producers alike. One of the respondents who had immense experience in global logistics services said that to properly understand the cost drivers affected by traffic congestion, it was important to explain three types of operation business impacts – direct travel costs, logistics and scheduling costs, and market accessibility costs.

What are the possible Solutions to the Traffic Congestion Problem in Dubai?

When asked to state why the Dubai Metro has not made much difference in reducing the traffic congestion problem in Dubai, two of the respondents said that the problem is largely cultural.

I do not think that Dubai suffers serious traffic congestion problems because we lack the alternatives of how to solve it. If you ask me, I would simply sum it up as a cultural problem where people prefer to use road transport as opposed to any other form of transport.

One of the respondents agreed with this view because he said other developed cities have easily solved their traffic problems by looking for unconventional solutions to solve their traffic problems. He said,

Look at Copenhagen for example, it has millions of people on the streets, but they rarely suffer from traffic problems as we do here in Dubai. Most people use bicycles there. What if we were to adopt the same strategy here? Do you think it would work here? I believe not…you know why? Because we have a cultural problem where it is unpopular to use greener modes of transport that would easily solve our traffic problem. In some of the world’s most developed cities…again, like Copenhagen…you would find that even government officials cycle to work. Do you think a government official in Dubai would do that? I guess not.

Although two of the respondents agreed that Dubai needs to look for unconventional solutions to its traffic congestion problems, they disagreed with the solution of using bicycles as a common mode of transport because of the climatic conditions in the Middle East. One said,

Look at the climatic conditions in Dubai. It is too hot. Who would cycle in this weather? It is too physically demanding, don’t you think?

However, this respondent was quick to clarify that he agrees with the use of ingenious methods of transportation to address some of the perennial traffic problems that Dubai faces. For example, he said that most of the traffic congestion problems in Dubai are focused on solving the supply side of the problem. Therefore, there has been a neglect of the demand side of the equation.

You know…devising new ways of discouraging people from using road transport would solve some of the main challenges we face in Dubai today. For example, encouraging people to travel during off-peak times could partly ease the demand on road transport during peak hours.

Expanding the mass transport system in Dubai was also touted as another solution to the traffic management problem in Dubai. The Dubai Metro was cited by many respondents to be a positive step by the Dubai government in addressing the traffic congestion challenges in the city. However, it was not enough to reduce the demand for road transport. One respondent was quick to bring the cultural dynamic of this problem by saying that there needs to be a cultural shift in how residents of Dubai commute because he found out that many people still do not want to use the mass transit system, despite its availability. He posited that,

It still would not change a thing if the government builds a thousand other mass transit systems if people are not willing to use them. I know many people who would easily use the mass transit system, but still choose to drive. Therefore, there is a need for massive civilian education regarding the use of the mass transit system. The preservation of the environment is one such benefit that most residents of Dubai should understand.

In response to this view, one of the respondents clarified that authorities in Dubai have already started engaging in civic education regarding the use of public transport systems. He pointed out that such efforts are often easily seen during the Public Transport Day where the RTA often sensitizes the public about the use of different forms of mass transport systems, such as the metro, tram, and marine transit systems. The respondent also said that during the public transport day, a group of selected winners in a competition is identified, based on the process of evaluating the most frequent user of public transport systems. The winner is often awarded AED100,000.

When asked to state his views regarding the operational activities of the Dubai Metro, one of the respondents said, it has helped to alleviate the traffic congestion problem in the city but more needs to be done to further improve its outreach. Another respondent agreed with this view by saying that existing attempts by the RTA to expand the Dubai Metro is a welcome strategy because there needs to be more capacity to accommodate more people on this transit route.

How do you think increasing or expanding the road transport networks would increase the accessibility of the economic hubs?

In our analysis, we also sought the respondents’ views regarding their thoughts about the expansion of the Dubai road transport network to increase the accessibility of the city’s economic hubs. There was a consensus among the respondents that doing so would help to alleviate some of the traffic congestion in Dubai. Some of the respondents believed that the benefits of doing so would only be beneficial to certain segments of the economy because roads that are notorious for traffic congestion serve some parts of the economy.

Using this analysis, some of the respondents argued that economic sectors, which encountered minimal traffic, were bound to benefit the most from an increase in infrastructure investments, while those that suffered from traffic notoriety were not bound to post such positive results. One of the respondents said that this view makes sense because based on the kinds of investments undertaken by the RTA; it is difficult to have a significant impact on the traffic congestion problems if the roads are often clogged by miles of bumper-to-bumper traffic. In other words, businesses that are served by roads that are in high demand are likely to report the least benefits from road transport network expansion.

The reasoning is that it would take many infrastructure investments to realize any meaningful benefits from road transport expansion. Based on the type of investments undertaken by RTA, there is a low probability that businesses, which depend on major highways, are bound to experience significant economic gains from an increase in road expansion network. This analysis reveals that most of the respondents were of the view that road transport expansions would mostly benefit businesses that suffered from mild traffic. The justification was that low investments in road infrastructure would clear traffic in these economic zones and create an efficient transport network for the delivery of goods and services.

Regardless of these views, one of the respondents had a dissenting view in the sense that he did not believe that the current investments made in the road transport network would yield significant economic gains. This respondent also advocated for a pursuant of ingenious ways to solve the road traffic problems in Dubai, shunning the reliance on significant infrastructure expansion methods. Relative to this assertion, he said,

I would be more optimistic if the government invested in creating more mass transport services, as opposed to expanding the road network. So far, in the past 15 years, we have been engaged in serious infrastructure investments, but there have been few returns associated with this strategy. Frankly, I believe that expanding the road transport network has poor returns on investments because the pace at which people are buying cars significantly dwarfs the pace at which the government is expanding existing roads, or making new ones.

One of the respondents believed that the rate at which the government is making investments in the transport sector would not have such a huge impact on big business in Dubai. To explain this assertion, he said,

People always assume businesses in Dubai rely on road transport. There are other types of transport as well. For example, air transport. It is a common mode of transport for companies that export most of their products. The same is true for maritime transport because some goods are often shipped to other countries using this mode of transport. It would be illogical to assume that road transport investments would have such a bug impact on businesses in Dubai because some of them do not necessarily rely on this mode of transport.

This respondent shared the above statement, but these views were mostly limited to big business. However, his opinions highlight the concepts of the triple convergence effect, which we learned in the second chapter of this paper (literature review). This principle explained that regardless of the kinds of investments governments make in the road transport sector, significant investments in this regard would be unsustainable because people would easily swam “unclogged” routes and create the problem of traffic congestion again.

In the literature review section of this paper, we found out that respondents who shared this view had a cynical view of the traffic congestion problem in many cities by even suggesting that people should learn to live or accept traffic problems. Broadly, it appears that proponents of the triple convergence effect do not believe in the goal of easing traffic congestion through significant infrastructure investments. However, this strategy is the most active one adopted by the RTA and the UAE government.

This view is seen through the massive infrastructure projects undertaken by the Dubai government in the past few years. Some of the significant infrastructure investments undertaken by the Dubai government include the development of the Dubai-Abu Dhabi-Northern Emirates link, the development of the Dubai-Abu Dhabi Link, development of the Business Bay District, development of the Al Ittihad Bridge, development of the Al Shindagah Bridge, and the development of the Jumeirah Street-Al Khail Link (among others).

Based on an assessment of the respondents’ views and a review of the principles of the triple convergence theory, we find that most of these infrastructure investments may not yield their desired effects. This realization brings our attention to the need to find creative ways of reducing traffic congestion in Dubai. The change of community culture regarding other modes of transport is a good place to start this debate because it would be difficult to mitigate the traffic congestion problems by simply building new roads or expanding the capacity of existing road networks to accommodate more cars.

The RTA should consider pursuing alternative strategies of managing the traffic congestion problem in the city by considering the merit of some of the views given by the respondents. For example, the respondents who highlighted the importance of commuter education and changing the community’s culture towards other forms of transportation was progressive because their views presented alternative strategies for managing traffic problems and possibly providing cheaper alternatives for solving the traffic menace in Dubai, as opposed to sticking to the traditional approach of expanding the road network. Car-pooling is one such ingenious strategy of addressing the demand-side of the problem because it would create a decline in the demand for road transport.

How Accessible Are Various Economic Hubs In Dubai?

When asked by the respondents to state the accessibility of various economic hubs in Dubai, most of the respondents were of the view that different economic hubs in the city were mostly accessible. One of the respondents was quick to point out that we should not look at accessibility to mean only in the context of road transport. Another respondent said that this analysis was ambiguous because even if we were to look at road transport alone, we find that the existence of roads alone means that the economic hubs are accessible. Instead, he proposed a different metric for asking the same question by saying that “accessibility” should be viewed in terms of ease of access, as opposed to “access” by itself.

When explaining his point, he gave the example of the variability of economic zones during different times of the day. Here, he pointed out that during peak hours, the accessibility of the mentioned economic hubs would be low, while during the off-peak times, it would be high. Consequently, he said that he could not answer this question with the clarity it deserves. However, the other respondents did not show much objection to how the researcher framed the question, because they said that most economic hubs in Dubai are accessible.

They also believed that if the efficiency of the road transport system were improved, these economic centers would realize improved productivity. When asked to give examples of the main economic hubs of Dubai, the respondents mostly mentioned the airport and seaports. Nonetheless, three of the respondents also mentioned these economic hubs, but included the central business district and the export processing zones as well. Another respondent mentioned that the city’s industrial zone was also another significant economic hub of Dubai. None of them argued that these economic centers were inaccessible instead; most of them believed that inefficiencies in the existing transport system made it difficult for businesses to extract the full value of their activities.

How do you think Dubai Traffic problems affect its Economy?

When asked to give their views regarding how traffic congestion in Dubai would affect the country’s economy, the respondents had a unanimous view that the city’s traffic would have an adverse effect on the economy. However, most of the respondents said that there is a need to analyze the type of effect traffic congestion would have because it would be unwise to describe the effects of traffic congestion by the inability or ability of people to reach their desired locations.

The respondents suggested that such an analysis needs to be comprehensive in the sense that the aggregate impact of traffic congestion is clearly understood by all people. For example, three of the respondents pointed out the need of investigating the impact of traffic congestion in the delivery of goods and services to different customers. Another set of respondents highlighted the need for assessing the impact of traffic congestion on the delivery of raw materials or supplies to specific businesses. Generally, their views emphasized the need for understanding the impact of traffic congestion on the demand side and supply side of Dubai’s economy.

Throughout our discussion, I also sought the views of the respondents regarding the effect of traffic congestion on different economic sectors. I did not give them any criterion to comprehend this question or to present their answers. There was a consensus among most respondents that the manufacturing sector would experience the greatest hits on performance because of an increase in traffic congestion.

When asked to justify this view, they said that this sector mostly relies on the timely delivery of supplies and products to their customers. The vitality of physical commodities to the manufacturing sector was therefore instrumental in informing their decision to choose this sector as the most vulnerable to traffic congestion problems. If we take this analysis and frame it in the context of the findings we received from the secondary literature review, we find that the respondents alluded to the effects of traffic congestion on Dubai industrial zones because this is where most manufacturing companies are located.

Therefore, it is safe to assume that traffic congestion along major roads and access roads that lead to the city’s industrial zones have the greatest impact on the economy of Dubai because the manufacturing sector is also a significant contributor to the country’s GDP.

When asked to state which sector was the least vulnerable to traffic congestion problems, most of the respondents said the service sector was the least affected. They made a comparison between this view and the earlier view of naming the manufacturing sector as the most affected by traffic congestion because the manufacturing sector was dependent on the supply of human labor and the supply of raw materials to the factories or finished products to the customers.

Comparatively, the service sector was mostly reliant on the supply of human labor as the main factor of production. In this regard, it was less susceptible to different elements of transportation. If we take our findings from the secondary literature review to analyze this statement more critically, we find that the respondents were referring to the effects of traffic congestion on the economic activities in the CBD because this area mostly hoists many service-oriented businesses. Comprehensively, the respondents’ views pointed to the fact that traffic congestion was most impactful to the industrial zones of Dubai and least impactful to the CBD because of the nature of businesses going on in these regions.

Congestion significantly Reduces Dubai’s Economic Growth

Based on the findings we got in this paper, we argue that traffic congestion problems reduce the city’s economic growth potential. This assertion stems from our analysis of the region’s road networks which we got by reviewing the city’s planning blueprint. Using the city’s major malls, airports, and factories, as major economic centers, we translated the available data into a consistent format to allow for easy analysis. As mentioned in chapter three of this paper, we used the thematic and coding techniques to do so. Using the 25-minute assessment framework, we analyzed the drive time contours.

For this analysis, we used a base year (2030) and the projected city’s development plan for the same year to analyze the city’s traffic problem under both congested conditions and when there is free-flowing traffic. We stretched our analysis to include an assessment of regional productivity because this was part of our analysis as well (this focus is represented in the research questions for the paper). This analysis helped us to examine the relationship between traffic congestion relief and regional productivity in the UAE and the wider GCC area. Using this assessment, we were able to find out the major effects of traffic congestion on major metropolitan areas in Dubai.

Unsurprisingly, we found that Dubai’s Central Business District was the most accessible area in the city. About 30% to 60% of jobs in the Emirate were located in this area. Our findings affirm the views of previous researchers who have shown that the CBD is the most accessible region in the city (National Cooperative Highway Research Program 13). Traffic congestion often decreases the access to the CBD by between 1% and 10%.

However, eliminating this problem could increase access to the CBD by between 2% and 30%. This estimation allows most cities to reverse the negative effects of the economic growth of a region. The Oxford Business Group (9) undertook a similar research and found out that a 10% decline in accessibility to the economic hub of a city decreases its productivity by up to 1%. Researchers who have undertaken the same study in Europe and South Korea have also come up with the same findings (National Cooperative Highway Research Program 13). Nonetheless, in our paper, we found that there is a difference in the way regional economies and businesses in the central business district are affected by traffic congestion.

In detail, we found that regional economies are often significantly affected by traffic congestion that inhibits access to malls, educational institutions, and suburbs. Comparatively, the CBD is not affected by these factors significantly. The models of productivity for access to malls, universities, and suburbs provide a strong model of analysis for the relationship between traffic congestion and economic growth because the economic reliance on these hubs is high.

According to our respondents, reducing traffic congestion in roads that lead to malls, educational institutions, and suburbs could lead to a 30% increase in economic productivity for Dubai. The gains made from reducing traffic congestion that lead to the CBD would be lower at between 4% and 10%. Comparatively, alleviating traffic congestion problems on roads that lead to the airport could only lead up to 4% of economic gain.

Based on the percentages highlighted in this report, safely, we could assume that reducing traffic congestion on roads that lead to these key areas could significantly increase the regional productivity of Dubai. Similarly, the city’s tax revenues would increase, thereby increasing the quality of goods and services offered to taxpayers based on taxpayers’ money. Therefore, smart infrastructure investments targeted at these key roads would significantly yield greater economic returns for the Emirate. Based on this analysis, authorities should rethink the city’s overall road transport plan, particularly regarding roads that lead to non-CBD locations in Dubai.

Conclusion

Overall, from the general analysis of the views we received from the secondary literature review process and the interview process, we find that traffic congestion, broadly, has a negative economic impact on the economic growth of Dubai. Intricate details of this relationship have emerged throughout the five chapters of this paper and they allude to the increased costs businesses in Dubai would incur because of an increase in wage rates and delivery costs.

Issues of market access have also emerged in this paper as other areas of key concern because they outline how traffic congestion problems in Dubai would affect the demand side of the economy. These issues make Dubai relatively less competitive than regions that address their traffic problems. Therefore, traffic management should not be overlooked as an inconsequential element in the management of the economy.

Going forward, this paper points out the need for formulating new ideas in traffic management in Dubai as opposed to relying on the traditional methods of road traffic expansion. Borrowing from the principles of the triple convergence theory and expert reviews, this empirical paper proposes the need for using ingenious methods of traffic management, such as car-pooling to avert some of the inherent problems associated with increased traffic congestion in a rapidly growing city, such as Dubai. Overall, this paper demonstrates that solving the traffic congestion problem in Dubai could add billions of dollars in additional productivity to the Dubai economy.

Part of the advantages of doing so would be increased regional productivity because of free following traffic. This advantage would yield increased revenues for the Dubai government, as it would be able to collect more revenues from the efficient economy. Therefore, by engaging in increased infrastructure investments, authorities in Dubai and it citizens would easily find out that the investments made in eliminating traffic congestion would soon pay for itself through an improved image of the city and boosting the region’s economy. This paper has also demonstrated that increasing investments in the transport sector would reduce traffic congestion and improve the access to key retail, education, and employment sectors, which are the driving centers of Dubai’s economy.

Accurate findings of this advantage reveal that these advantages would increase the regional production of goods and services by more than 2% (Gulf News 1). Although this percentage increment may seem small in number, it translates to massive employment opportunities for residents of Dubai because the economy would be more efficient and productive. In this paper, we found out that the economic impact of traffic congestion in Dubai is significant.

Removing the gridlock in the city by increasing infrastructure investments and expanding the capacity of the public transport system to promote ease flowing traffic would easily boost the productivity of workers in Dubai by up to 30% (Gulf News 1). Since we have already established that traffic congestion would affect different parts of the city in different ways, ongoing and future attempts at easing the city’s traffic problems should be concentrated in areas where there would be significant improvements in economic outputs if infrastructure investments are made.

For example, increasing infrastructure investments in areas like the CBD and the city’s industrial zones would easily increase the areas productivity by up to 30%. Similarly, increasing infrastructure investments around major education centers (such as universities) could improve the sector’s performance by up to 20%.

These areas would greatly increase the overall productivity of the economy because they focus on improving the productivity of major areas of economic performance of Dubai’s economy. Priority to increase investments in areas where there is going to be little economic productivity would not yield the same level of economic performance. Such areas include road networks that lead to downtown Dubai and major malls in the city. If the government insists on directing investments in these regions, it would realize lesser productivity compared to making investments in the above-mentioned areas.

The findings of this paper break new ground in how we view traffic congestion problems in major cities around the world because unlike previous research studies that often rely on distance to evaluate the impact of traffic congestion problems in a city, the findings of this paper rely on the economic output of different sectors. In this paper, we evaluate how traffic problems affect key employment sectors and destinations in Dubai, including how they affect other key aspects of the city’s economic performance including its education centers, hospitals, and factories.

To get accurate results in this analysis, we used a 25-minute time standard to analyze the impact of the traffic congestion problem on the economy. We used this 25-minute time standards because it is the globally accepted media for travel to work during peak hours. This measure has been used by different researchers in the context of evaluating the usage of roads and traffic congestion using this mode of transport. It is also a straightforward metric for evaluating traffic problems.

Collectively, the findings of this study would be useful to people who want to understand the economic implications of traffic congestion in the Middle East because Dubai is a model city in this region. Since past studies have highlighted the complexity of the relationship between traffic congestion and economic growth, the findings of this paper should be viewed as an incremental step towards a broader understanding of the same relationship.

Here, it is also important to point out that the findings of this study do not give the final word on the research issue; instead, it provides a starting point for a deeper analysis of the same issue by highlighting the different facets congestion and their effects of businesses in Dubai. Additionally, the findings of this study provide us with a more accurate measure of assessing the monetary cost of traffic jams in Dubai and other major cities like it in the UAE and the wider Middle East region.

As highlighted in the first chapter of this report, this analysis is more reliable and comprehensive than the reliance on user experience and travel time cost to understand the economic cost of traffic jams in Dubai. Indeed, the findings presented in this study go a step further by including a productivity analysis of associated travel time variability. It also includes information about market accessibility, travel time variability, and worker time availability (among other productivity elements that are vulnerable to transport conditions). The result is a general model that researchers or academicians could use to understand the impact of traffic congestion on the economic growth of Dubai and other cities that share its profile.

I chose to study Dubai in this case study because the city is among the leading financial centers in the Middle East and one of the most recognizable economic centers in the GCC region. The World Bank and other global organizations affirm this fact because they have pointed out that this region is a promising economic hub of the Middle East (Kuo 440). However, as we have seen, there are serious capacity problems in Dubai’s urban and rural road transport networks that undermine this position.

Addressing these capacity gaps could help to promote economic growth in the region and encourage regional integration among the different metropolitan areas that are interlinked to Dubai’s economy. Furthermore, understanding how to solve the high traffic congestion problems in Dubai would help to improve the quality of life for residents of the city and help in creating employment opportunities in the transport sector and virtually many other economic sectors of the Emirate, which depend on the efficient and timely mobility of factors of production.

Since many accidents in Dubai also arise from the inefficiency of the emirate’s road transport network, the findings of this paper could also help to reduce such incidences and possibly lead to saving human lives that would otherwise be lost through an inefficient road transport network.

The findings of this study would also add to our understanding of people’s perception towards the public transport system (especially in the UAE), thereby providing us with a proper understanding of how receptive residents of Dubai would be in using the public transport system if it was improved. Since congestion is associated with many of Dubai’s transportation problems, such as slow transport and extensive waiting times, the findings of this study would also be instrumental in alleviating some of these challenges by providing a blueprint for the improvement of the country’s transport network.

The findings of this study would also provide a deep insight into how urban traffic congestion in Dubai affects the main producers of goods and services in the economy. The analysis would include (but not be limited to) the business costs, productivity, and output of the affected businesses. The sensitivity accorded to this analysis stems from the fact that some economic sectors of Dubai are easily vulnerable to the mobility of labor, and the availability of specialized inputs, which may be affected by traffic congestion problems.

The same is true for businesses whose markets mostly rely on the easy movement of customers. This observation explains why different research studies have demonstrated how businesses can compensate for congestion problems by simply changing their addresses to areas that are not prone to traffic problems (Kuo 440). Lastly, an important caveat to note in this study is that its findings mostly come from an analysis of productivity factors and not the economic costs to Dubai that may occur because of personal travel delay.

Recommendations

Based on the insights provided in this paper, we find that future studies should follow three main directions. The first one is analyzing the effectiveness and cost of alternative options for analyzing different types of traffic jams facing cities in the Middle East. The variability in assessing these options stems from the differences in land use and economic settings. These two key variables are not properly addressed in this paper.

Future research studies should fill this gap, including estimating the effects of transportation policies and strategies. The findings of this study abstractly provide a descriptive analysis of the effects of these factors on traffic congestion, but the results are rather simplified and hypothetical. For example, in this study, we failed to evaluate the relative costs and benefits of adopting alternative transportation projects. We also failed to estimate the impact of different transportation policies adopted by the Dubai government.

To fill these research gaps, future researchers should adopt the methods outlined in this paper, but also merge the analysis with separate evaluations of the effects of different transportation investments on the scenario under analysis. This analysis would provide useful insights into how the increase or decline of traffic congestion could affect the economic growth of the region.

The second direction that future research studies should follow includes undertaking a complete analysis of the economic implications of an increase of decrease of traffic congestion. The studies should delve deeper into evaluating this issue by analyzing the economic effects of congestion on different classes of trips. In our assessment, we mostly focused on analyzing the effects of traffic congestion on product delivery. We also focused our analysis on evaluating the impact of traffic congestion on workforce related costs of production. We failed to evaluate the impact of traffic jams on personal trips or trips to malls and other recreational facilities/centers in Dubai.

In part, we did not focus on this analysis because we did not have access to inter-zonal data about the different types of leisure trips undertaken by residents of Dubai. Consequently, our findings were mostly concerned with the supply side of Dubai’s economy and not the demand side of the economy. Future studies should focus on accessing or acquiring such data to have a more holistic overview of the effects of traffic congestion on the demand side and supply side of the Dubai economy.

Future research studies should also have a more holistic overview of truck movements in the Dubai economy to identify patterns of traffic congestion that could ultimately influence how the general economy is affected during times of excessive traffic. Indeed, we found that only a few studies explain truck movements in Dubai. This insufficiency of data partly explains the lack of data on truck origin-destination zonal patterns. We also found that few researchers have investigated the coverage of truck trips with outside origins or destinations.

Similarly, we realized that there is scanty information about industry/commodity breakdowns for products being carried. Most of the data we found also lacked crucial information about business product or service delivery that used vans, private cars, or light-delivery vehicles. Therefore, we synthesized most of the information about business transport based on partial information, creating room for future research to undertake a detailed analysis of the travel data through a detailed commodity flow survey. Future studies should also focus on getting credible information about the coverage of non-commodity business travel.

Future research studies should also focus on obtaining detailed information on the service sector because the findings of this study emanated from a process, which involved treating service producers as one industry. We also considered a specific class of work-to-home travel and home-to-work travel as a suitable surrogate for our analysis. Our analysis failed to capture the variability that exists in the service sector area, particularly concerning their reliability of the transportation sector and the variability of different inputs and outputs.

A more considerate and comprehensive approach of the service sector business is to undertake carefully designed surveys to get this data. Such an attempt could sufficiently provide important qualitative data that we could use for future model estimation about the research information. Such information would also be useful in providing qualitative information to analyze the relationship between congestion and the service industry. Planners and decision-makers would greatly benefit from this information.

Close to this analysis should be increased attempts by researchers to gather data regarding business-related travel patterns to have a comprehensive overview of the effects of traffic congestion on the Dubai economy from the perspective of the influence of movers and shakers in the Dubai economy. This paper already touches on this issue lightly through the analysis of the effects of traffic congestion on the Dubai International Airport, which is a major transit point or area of analysis to identify business-related travel patterns. Data from metropolitan planning organizations could help to expand the scope of data relating to this issue because they have information regarding the origins and destination of different travelers in Dubai.

Appendix

Interview Questions

1. How accessible are various economic hubs in Dubai?
2. How do you believe the accessibility of these economic hubs would change in the future?
3. How do you think increasing or expanding the road transport networks would increase the accessibility of the economic hubs?
4. Overall, how do you believe increasing the accessibility of Dubai’s economic performance would affect the economic performance of the region?

Works Cited

Arasan, Tamil. Urban Transportation Systems Planning, Accra, GH: Madras, 2012. Print.

Badge, Emily. How Traffic Congestion Affects Economic Growth. 2013. Web.

Biddix, Patrick. Mixed Methods Research Designs. 2015. Web.

Clarkson, Natalie. What is the Economic Impact of Traffic? 2014. Web.

Downs, Anthony. Why Traffic Congestion Is Here to Stay and Will Get Worse. 2004. Web.

Eddington, Robert. The Eddington Transport Study Main Report: Transport’s Role In Sustaining the UK’s Productivity and Competitiveness, London, UK: UK Department for Transport, 2006. Print.

Gulf News. Dubai traffic woes inflict losses of Dh4.6b a year. 2016. Web.

Hartgen, David. Gridlock and Growth: The Effect of Traffic Congestion on Regional Economic Performance. June. 2009. Web.

Kuo, Wang. “Optimising the VRP by Minimizing Fuel Consumption.” International Journal of Management and Environmental Quality 22.4 (2011): 440-450. Print.

Mason, Peter. Tourism Impacts, Planning and Management, London, UK: Routledge, 2015. Print.

National Cooperative Highway Research Program. Economic Implications of Congestion. 2001. Web.

Oxford Business Group. Dubai Pursues Ambitious Public Transport Targets. 2016. Web.

Smeed, James. “Traffic Studies and Urban Congestion.” Journal of Transport Economics and Policy 2.1 (1968): 33-70. Print.

Sweet, Matthias. “Traffic Congestion’s Economic Impacts: Evidence from US Metropolitan Regions.” Urban Studies 51.10 (2013): 2088-2110. Print.

UN Habitat. State of the World’s Cities 2012/2013: Prosperity of Cities, London, UK: Routledge, 2013. Print.

Zikmund, William. Business Research Methods, London, UK: South-Western. Print.