Tuesday, July 17, 2007

The Economics of Parking

Next time you're cruising around the block for 15 minutes looking for a free parking spot there are some numbers to think about. Over the course of a year, this type of parking search results in innumerable excess miles driven (one group puts the number at around 950 000 for a 15-block business district) and all the associated pollution and greenhouse gases. In large cities, this is also a major cause of gridlock with up to 45% of drivers claiming they were just looking for a parking spot. The solution? According to Canadian-born William Vickrey, winner of the 1996 Nobel Prize in economics: increase the cost of curbside parking. By increasing the cost of street parking to market value on par with off-street parking lots, policy makers can fix prices such that they ensure an 85/15 ratio -- "85% occupancy means that the curb spaces will be well used and 15% vacancy means that they will be readily available," says Douglas Shoup, professor of urban planning at UCLA. Of course most drivers would balk at the idea of more expensive curbside parking, but in cities where this kind of idea is being considered and implemented the increased revenues are put directly back into the metered communities.


12 comments:

Bayman said...

I have a better idea. Abolish the state repression of people's rights and allow people to park on the street-side wherever it does not completely stop the flow of traffic. I think we need less state-enforced regulation of parking not more.

Anonymous Coward said...

Actually, I suspect that people left on their own would be inefficient at parking. While most people who park will try to use the least amount of space to help others, a minority will cheat the system or disregard the need of others. Case in point, the parking was completely unregulated at the bluesfest this year. I was really intrigued at how creative people were at finding spots. I took a habit of counting the cars and guessing how much you could actually put at maximum efficiency. I estimate that you could fit between 25-30% more cars on any given night. Not because that on average they were badly parked but because one of every 10 car or so completely disregarded the need of others to park and took way more space than it needed. It makes me wonder how the personality of these people compares to the average.

Bayman said...

I would argue that this is because Ottawans are so dependent on being spoon-fed by strict parking regulations that they have lost their parking skills. Given time, Ottawans would learn to develop efficient parking skills, just like cyclists don't need lines to show them where to lock their bikes.

Anonymous Coward said...

Yeah it's also a culture thing. In Spain people triple park on the sidewalk, or leave their car in the middle of the road while in a cafe, and will move them if someone honks. Here that behavior would probably elicit road rage.

kamel said...

I posted this more because it was an interesting application of economics more than an endorsement of the idea (I'm a pedestrian, so it's an issue that largely doesn't affect me).

I think the idea proposed is more geared towards a large, crowded city like New York or Los Angeles (though Redwood City, CA seems to be adopting it and it has a population of less than 80 000) with many cars and limited space.

In a city like New York, for example, you can either pay in excess of $20 (US) for the first hour of parking, or a few coins at a meter - which by comparison is essentially free, and close to the situation you suggest (granted you can't park just *anywhere* on the streets). So what will the average person do? Probably cruise the streets looking for the cheap space adding to the pollution and traffic congestion which is what the 85/15 ratio price-point aims to prevent.

Should the government intervene in all matters like this? Probably not, though when start talking about $13 billion in lost productivity or 47000 gallons of gas consumption then maybe you can start making an argument. Either way, at the very least it's an interesting economics approach to a tangible, everyday problem.

Bayman said...

I agree NYC is an example where some regulation is absolutely required based sheerly on crowding issues. In Ottawa, in contrast, there are a very small number of locations where this is an issue (ie the Byward Market), yet parking is unnecessarily regulated throughout the city as a backhanded way of extracting revenue. Then again, we do live in the capital of the land of excessive regulation and inefficient use of taxpayer revenue.

Reducing unnecessary energy consumption and pollution is great, so let's be honest about why we're doing things and confront issues head on rather than through backhanded and oppressive lawmaking - it's just more efficient.

Alfred Russel Wallace said...

People don't need help parking? Really? Ever looked at how people park when snow hides those "helper lines"? People have no idea how to park...

Bayman said...

Yeah, and it's always hilarious every winter when we get the first snowfall and everyone suddenly forgets how to drive. Maybe this is also symptomatic of a culture of dependency on plowing and salting. In Norway, they just strap on the AutoSocks and keep on givin' er'. Maybe we could even make up for the lost parking ticket revenue by banning plowing/salting.

Kevin Z said...

Like Mr. Kamel, I'm a pedestrian/bike-rider. In winter I cross-country ski in to my lab.

Though the economics application is an interesting one, I think the parking dilemma answer lies in reduced demand for parking spaces. Policies should be aimed more at reducing driving and making it more easy to people to commute via bike or walking or put in place a better, more organized public transport system. I thought the BART system was great, the only drawback was it didn't go all the around the whole bay area. If every middle-sized to major city had a lightrail, trolley or subway parking demand and pollution will decrease while parking spaces may turn into greenspace or more local shoppes.

Bayman said...

I agree - better city planning and public transport is what's required. Hopefully the city of Ottawa will get past the talking and get moving on light rail.

kamel said...

Ottawa did get moving on light rail. Had a signed contract with a developer and everything. Then they changed their minds, leaving the city open to lawsuit or at least on the hook for a large sum of money with nothing being gained from it. And now they're talking about it again? *sigh* Politicians!

Bayman said...

Yes...by "moving" I mean "build something dammit!"