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How will driverless cars affect the economy?

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    What are the benefits of driverless cars?

    Lots of companies are racing to introduce driverless cars onto our roads. There are some obvious benefits, like reducing accidents and the time spent in traffic jams. At the moment, for example, UK drivers on average spend 127 hours stuck in traffic each year.

    What could driverless cars mean for the economy?

    But there could be wider changes that come with more and more driverless cars on the roads. This raises some questions about how the economy could be affected.

    For instance, if commutes become more enjoyable, will more people start to live further away from their workplaces? And when accidents happen, who will pay – insurers, or the companies that build the cars?

    This video introduces these and other issues raised by driverless cars:

    The Bank of England takes an interest in developments like this which can have an impact on how we work and how productive we are overall. This can feed in to how fast the economy grows.

    We monitor in particular changes in the insurance industry because we are responsible for regulating insurers in the UK to ensure that they operate in a safe and sound way.

    Find out more:

    • For more detailed analysis on the impact of driverless cars on the insurance sector, see this Bank of England article.
    • Some Bank of England analysts also discussed the issue of driverless cars on Bank Underground, a blog written by staff at the Bank of England.

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