By reduction of traffic I thought you were referring to the phenomenon of actually being "stuck in traffic". I don't think we're going to necessarily reduce the actual number of people on the road with autonomous self-driving cars. But traffic flow should be smoother and definitely safer. And if all an autonomous grid reduces is number of deaths from accidents every year... than I'm happy with that. Other than that, you're definitely challenging some of my assumptions about driverless cars, specifically in regards to cost. However, I still think they will happen and re-organize our transportation grids.
"Stuck in traffic" is a lifestyle in much of the urban world. LA traffic is essentially one long traffic jam whose density varies with time. That's what "an increase of density" really means - either cars moving slower or cars moving so fast that people can't keep up. The basic premise of autonomous driving cutting down congestion is reliant on vehicles acting in concert. This works under predictable conditions, and a traffic jam is certainly that. In practice, the difference between a freeway going 60MPH and a freeway full of autonomous vehicles going 60MPH is the follow distance. The idea is that you cut out individual human reaction time (which is cumulative). Traffic flow models an awful lot like fluid mechanics. A traffic snarl is remarkably similar to a shockwave - whenever you see cars stopped for no reason, think of air blowing over a bottle. The resonance is functionally the same. Making that traffic act in concert turns the flow superfluid - and that's where things start to get tricky. There are already problems with inclement weather. A Google Car in a rainstorm likely has better traction control than a human car... but it doesn't have better judgement. The system works because it's a system and as soon as that system requires individual initiative, it's a bunch of particles again. It's important to note that while Google has had its cars out driving around for a half million miles, it hasn't had a half million google cars driving a mile. For places like Seattle or San Francisco or New York or Cleveland where "inclement weather" is an everyday occurrence, autonomy buys you nothing.