Tuesday, August 17, 2010

Yup, free parking still costs too much

Economist Tyler Cowen isn't exactly an early-bird to the party, but he makes the case against free parking in a New York Times column:

Is this a serious economic issue? In fact, it’s a classic tale of how subsidies, use restrictions, and price controls can steer an economy in wrong directions. Car owners may not want to hear this, but we have way too much free parking.

Matt Yglesias had a different take on the problem, comparing free and underpriced parking to Soviet-style price controls:

People generally understand that there were shortages and long lines for things in the Soviet Union because goods weren’t priced according to supply and demand. And people generally understand that, in general, price controls will tend to lead to either gluts or shortages. And yet few people understand that this same principle applies to on-street parking. In many places, it’s hard to find and that’s because it’s not priced properly.

More food for thought.


Anonymous said...

Matt Yglesias has a lot of intersting ideas:


Anonymous said...

Way too much free parking? Where, exactly, is all of this free parking?

Sean Roche said...

Not a single spot that you can see in this view costs a dime.

Anonymous said...

Since the only way you can think of alleviating a perceived problem is to charge for something.... I think the area around the no-leash parks should charge exorbitantly for parking. I think bicyclists should be charged for road use - drivers pay gas tax, tolls, etc. I think bicyclists should be charged if they leave their bikes on the sidewalks in the way of pedestrians. I think citizens who spend too much time at city hall pestering aldermen with their idea du jour should be charged double their real estate taxes as a waste of time tax. Newton is not NYC, Fenway, or Denver.

Anonymous said...

There is no parking on Needham St. If you are referring to the parking provided by businesses on Needham St... well these parking spaces are on private property. The owners or renters of such property paid for or pay for these spaces and they are free to allocate them as they see fit. The price of these "free" spaces is built in to the cost of goods or services provided by the businesses that paid for or pay for them.

dr2chase said...

Anon, and anon, you are failing to understand the analysis. If the parking is either provided free by the city, or "free" by mandating that businesses supply it, then it will be used even when it doesn't have much value to the person using it -- that is, it will be overused, and there will never be empty spaces.

Furthermore, claiming that the cost of the parking is "built in to the price" means that you are in violent agreement with Tyler Cowen; that is exactly his point, it would be economically more efficient to unbundle that charge so that people had the option of not paying it, if they could find a way (and there are certainly ways).

There is the additional cost of the car traffic caused by parking. That has a cost -- at least in Our Town (Belmont), "too much traffic" is the one thing that almost everyone is willing to agree on, and if a potential business is perceived as adding traffic, lots of luck getting your permit in a timely fashion, if you need any special stuff (zoning variance, special permit, etc). This is definitely a phenomenon with economic effects; traffic reduces the value of residential property, in some cases "traffic" is compensated for with "mitigation", meaning money spent on various road improvements and traffic controls. And if the town, from the start, demands that the business supply (free) parking, why wouldn't the traffic appear?

Come on guys, please, can we have a little more thoughtfulness on your part? Can you at least go read the linked-to articles?

Anonymous said...

I read the articles and I agree. Bicycles are a plot to surrender the US to United Nations control. :)

Seriously though, there is a lot smoke mirrors involved with these articles. As there always is with articles written by people who are paid to write from the extreme edges of the political spectrum.

Anonymous said...

If someone wants to enforce a time limit on parking to increase turnover that's one thing, and can be handled in other ways. There is no reason to gouge the public for use of public streets. There is always going to be some bozo that can afford it and pay extra. There is no excuse for extra money away from people who can't afford it. Not on public streets.

dr2chase said...

If you can afford a car, and to insure and fuel a car, I think you can afford parking meters. If the poor need more money, give them money -- don't give them parking. Perhaps they have something better to do with that money than spend it on parking -- why should the government be making that choice for them?