Best of both worlds? Balancing social welfare and environmental burden of smart transportation technologies

Smart transportation technologies (STTs) can improve traffic efficiency and social welfare, but their intensive computational requirements may also increase energy use and emissions. How to balance these welfare benefits against the associated environmental costs remains underexplored. To address this issue, this paper employs the Energy-Environmental Version of the Global Trade Analysis Project model (GTAP-E) to evaluate the environmental and economic impacts of STTs under multi-periods, multi-regions, and policy-intervention scenarios. Simulation results indicate that, under the modeled parameter settings, the marginal welfare gains from STTs diminish over time, while environmental costs keep accumulating, with the welfare-environment break-even point estimated around 2032. Carbon pricing helps extend the period during which welfare gains exceed environmental costs, thereby delaying the threshold. Renewable energy subsidies cannot alter the point, but they improve the post-threshold industrial benefit structure and support more balanced economic and environmental outcomes. Furthermore, differences in national industrial structures, supply chain positions, and trade linkages lead to significant regional variation in both domestic effects and cross-border spillovers. Collectively, this paper breaks through the existing static and regionally aggregated evaluation paradigm for STTs, reveals the phased evolutionary characteristics and regional specificity of their economic and environmental impacts, and provides policymakers with actionable insights.