Induced demand
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Induced demand – related to latent demand and generated demand – is the phenomenon that after supply increases, more of a good is consumed. This is entirely consistent with the economic theory of supply and demand; however, this idea has become important in the debate over the expansion of transportation systems, and is often used as an argument against increasing roadway traffic capacity as a cure for congestion. This phenomenon, called induced traffic, is a contributing factor to urban sprawl. City planner Jeff Speck has called induced demand "the great intellectual black hole in city planning, the one professional certainty that everyone thoughtful seems to acknowledge, yet almost no one is willing to act upon."
The inverse effect, or reduced demand, is also observed (see below).
See also
- Aanzuigeffect
- Braess paradox
- Downs–Thomson paradox
- Effects of the car on societies
- Externality
- Hedonic treadmill
- Jevons paradox
- Lewis–Mogridge Position
- Positive feedback
- Say's Law
- Schedule delay
- Supplier-induced demand
- Traffic flow
- Tragedy of the commons
