We examine the effects of urban form and public transit supply on the commute mode choices and annual vehicle miles traveled (VMTs) of households living in 114 urban areas in 1990. The probability of driving to work is lower the higher are population centrality and rail miles supplied and the lower is road density. Population centrality, jobs-housing balance, city shape, and road density have a significant effect on annual household VMTs. Although individual elasticities are small absolute values (≤0.10), moving sample households from a city with the characteristics of Atlanta to a city with the characteristics of Boston reduces annual VMTs by 25%.

Growth stability is an important objective—because development requires sustained increases in income, because volatility is costly for the poor, and because volatility deters growth. We study the determinants of average growth and its volatility as a two-equation system, and find that higher levels of democracy and diversification lower volatility, whereas volatility itself reduces growth. Muslim countries instrument for democracy, and measures of diversification identify volatility. In contrast to the lack of consensus on the democracy—growth relationship, the democracy—stability link is robust. Rather than focus on growth, this paper forges an alternative link between democracy and development through the volatility channel.