Paying for Parking

Parking is too cheap and the price is too sticky. As Tyler wrote in his NYT column:

If developers were allowed to face directly the high land costs of providing so much parking, the number of spaces would be a result of a careful economic calculation rather than a matter of satisfying a legal requirement. Parking would be scarcer, and more likely to have a price – or a higher one than it does now – and people would be more careful about when and where they drove.

The subsidies are largely invisible to drivers who park their cars – and thus free or cheap parking spaces feel like natural outcomes of the market, or perhaps even an entitlement. Yet the law is allocating this land rather than letting market prices adjudicate whether we need more parking, and whether that parking should be free. We end up overusing land for cars – and overusing cars too. You don’t have to hate sprawl,

Slowly things are beginning to change, however, as this excellent piece on parking in LA and parking scholar Donald Shoup describes:

Shoup is not opposed to all parking lots; he’s against cities requiring parking lots. “Would you require every home to come with a pool or every office to include a dining room because someone might want it?” asks Shoup. “Why not let developers build parking where the market demands it and charge its true value?”

…This spring the DOT plans to introduce an $18.5 million smart wireless meter system based on Shoup’s theories. Called ExpressPark, the 6,000-meter array will be installed on downtown streets and lots, along with sensors buried in the pavement of every parking spot to detect the presence of cars and price accordingly, from as little as 50 cents an hour to $6. Street parking, like pork bellies, will be open to market forces. As blocks fill, prices will rise; when occupancy drops, so will rates. In an area like downtown, ideal for Shoup’s progressive pricing, people will park based on how much they’re willing to pay versus how far they are willing to walk to a destination. In a trendy area like Melrose Avenue’s shopping district, where parking on side streets is forbidden to visitors, Shoup would open those residential blocks to market-priced meters, wooing home owners by guaranteeing that meter profits would be turned over to them in the form of property tax deductions. (That benefit could add up to thousands of dollars a year per household.)

Brooklyn’s Park Slope neighborhood is already experimenting with a version of the system, and so are San Francisco, Seattle, and Washington, D.C.

In D.C. you can now pay many parking meters via cell-phone. I’ve used the system and it works well.

Here are previous MR posts on parking.

Comments

Here's the thing: I would venture that a vast majority of the the population would disagree with the statement that parking is too cheap.

Half the job of economists is to tell the people they are being dumb. The other half is to tell politicians.

the vast majority of the the population would disagree with the statement that parking is too cheap.

Yes. they would. They might exclaim: "How dare you disturb the free-riding of dyed-in-the-wool libertarians!" or "Lord, give me a completely free-market economy, just not yet".

@Blunt: You don't seem to understand "free market". A monopoly which adopts variable pricing is still a monopoly.

The loudest complaints on our city-wide neighborhood lists about losing free parking and the addition of metered parking is from self-described libertarians. Most libertarians seem to be more about "don't tell me what to do or pay for, but give me free stuff", then about a free market.
This feeds in nicely with the "bungalow effect". Preserving bungalows seems to have become the main goal of cities. To the point where we don't build the highways or roads we really need. To the point where mandating parking for businesses is all about keeping people from parking in front of those bungalows.

And that explains the constant whine of "Why don't people listen to us more?"

Ok, then how about rephrasing it as 'the vast majority of parking spot owners aren't being paid enough for their space'. Owner's that are being forced to build additional spaces are of course subsidizing the cost of parking. So current policies are shifting the costs from one group to another.

What I see is ridiculously cheap meters followed by ridiculously exorbitant expired meter tickets.

Agreed. seems like these systems are just eating up consumer surplus. I agree that not requiring parking spaces to be built may be market efficient, but prices that rise when the spaces fill up doesn't seem all that efficient to me at all.

It might be more efficient to have predictive pricing. For example, pricing would start to rise in a consistent manner approaching morning business hours. Encouraging some parkers to arrive earlier to take advantage of the better rates. Thus better smoothing out disruptions caused by parking on streets.

Absolutely not. That would just allow people to game the system. If prices rise based on time and not actual usage then it's not really reflecting the supply/demand curve correctly and thus missing the point completely.

So arriving early to get a deal is considered 'gaming' the system in your mind.

I wasn't implying that prices should rise absent actual usage. But it's certainly predictable that on an ordinary business day that usage will rise dramatically as the time nears work hours. It's far more pragmatic and sensible to raise prices in anticipation of a very highly likely event than it is to rise prices after the event is underway. I'm not saying make the level artificially higher, just to use an efficient tuning parameter to optimize the ramp up, rather than have it rise drastically between 7:45am-7:59am.

Free markets don't have to be stupid, it's not a fundamental requirement. And the ultimate point is to better reflect the scarcity of the product and to more efficiently use it, not to have created a perfect supply and demand curve post facto.

@JWatts:

Most parking garages (downtown Chicago for example) already have early bird specials.

Is this a tool for social/economic segregation? In attractive retail or high employment areas, those who cannot afford to or who refuse to pay higher prices, retreat. In residential areas, those who cannot afford a higher price for daily parking move to neighborhoods of lower density. Zones of higher density, which provide many benefits (better retail selection, better services choices, connections to others, access to talent, access to customers, etc.), become the domains of those who can afford the higher price of parking. Zones of higher diversity, which provide many benefits, become rarer.

Both urban density and the relative advantages of urban density have been declining for a century. Cities, of course, long ago stopped being the best places to do manufacturing, but relative cultural advantages have declined as well -- the provinces are nowhere near as provincial as they once were. Online services have made local access to the art-house theater, bookstores, and libraries unimportant, for example. And because information flows so cheaply and easily to the provinces, higher-quality services are in demand there as well. Everybody--urbanite and suburbanite alike--watch the same cable foodie programs and have similarly raised expectations when it comes to dining out. The quality of restaurant food has improved dramatically in recent decades -- but more so in the boonies than cities. On the other hand, the disadvantages of urban density (expensive housing and services, high taxes, traffic congestion, poor schools) have not really changed. Really only the recent reduction in crime (which has been much greater in cities than in already low-crime suburbs) has tilted in favor of dense urban areas.

You forget the biggest factor - job prospects.

I live in the center city and went looking for a new job. I interviewed at 6 places (none more than 4 miles from home) and got two offers. One was 2.2 miles away and the other was 400 yards. That's just not possible in a less dense area.

I've had clients in rural areas and while the cost of living is low, they are like indentured servants, as the number of other professional jobs withing a commutable distance is essentially zero. Their employers know that and exploit that fact.

Living close to their workplace doesn't seem to be very important to most people, and is likely to be even less important in the future as more people are able to do their job remotely.

I'm not thinking of rural areas but suburban/exurban areas. The number of jobs within commuting distance in a metro area is large, and the fraction of those jobs located in the central city has also declined substantially. Far more people now commute from suburb-to-suburb than suburb-to-city. And time is the relevant measure for commuting rather than distance -- you can get around a lot faster in less dense areas. People who commute by public transport may have relatively short travel distances, but they have relatively long commute times. The commute times in the NYC area are the worst in the country -- and that's true whether people are driving or taking public transport.

I used to live in London, where parking is quite scarce. That's all very right and necessary, but it did cause problems. Nearly all the parking was reserved for residents (that is, voters) and not much was metered. One consequence was that tradesmen would often refuse to go the next borough because they didn't have a parking permit.

I live in London now and yes, what you describe is a problem. But isn't it more a problem of policy than of scarcity per se? A London-wide policy of the kind Shoup advocates would work well I think, though I'm sure the boroughs would resist giving up one of their main fiefdoms.

I've been reading your posts for years now. While your ideas for societal improvement may make economic sense, the world you want to live in: nobody else does.

This idea you're championing, like many others you argue for, reduces quality of life for everyone involved. This is just an elaborate, expensive scheme to siphon even more from the average Joe to the already rich.

Here's hoping that GMU implements this for faculty.

Nobody wants to live in a world where they can find a parking spot? That is what the variable pricing changes are all about.

Also remember that if shops get to decide how much parking they need, they have a strong incentive to provide enough parking, but can choose not to provide unnecessary, sprawl-causing parking, which will make it possible for more different types of businesses to open.

What about free-riding? I open near a store that offers enough spaces without any of mine. Manning lots etc. might be high transaction costs outweighing any benefits. Code-enforced parking spaces prevents free riding?

U.C. Berkeley provides on-campus parking for Nobel Laureates. (They have a special "NL" parking sticker.) The power of this incentive can be seen by comparing the number of Nobel Laureates at Berkeley to those at various lesser schools.

Cause or effect?

Or incidental

Haha, how droll! +1

Just want everyone needs, a world where everything comes in a Fedex box because the local area is too expensive for anything but condos and bars but where there is no parking for the Fedex truck when Fedex is making deliveries.

Economist should estimate what will happen to Tysons Corner Center when it starts charging for parking. Can a large shopping center survive when the customer traffic goes down due to higher parking costs?

This is inane. If you have enough parking spots that everyone always finds one, you don't need to charge. If you have a shortage of spaces (as the Tysons 1 mall does, despite 5 garages) then charging for parking won't reduce the number of customers who actually manage to shop there.

"If you have a shortage of spaces (as the Tysons 1 mall does, despite 5 garages) then charging for parking won’t reduce the number of customers who actually manage to shop there."

You don't know that to be true. The hassle of having to pay even a quarter to park is enough of a turn off that I would avoid patronizing the place. That's how I roll. I doubt I'm alone in that sentiment.

Yes, but you will be replaced by other people who used to not be able to get a spot. That is the whole point.

And circumstantial evidence would indicate those people will also be willing to spend more money. Since they are not as concerned at the quarter price.

Smirf. I suggest you take your money, build and operate such a scheme. Let us know in a decade how it works out.

Derek,

By "such a scheme" you are talking about a parking garage? I think plenty of parking garages are doing fine, but I have no reason to enter that business which I know nothing about.

And I'd start shopping there more frequently, I do my best to avoid Tyson's because parking is a nightmare.

Tysons Corner Mall will soon be near a metro stop. To keep the commuters out, the mall will have to defend the parking stops by charging. That means there will fewer casual shoppers and fewer people eating at the restaurant. Why pay to park to eat at a restaurant when restaurants in other places have free parking.

Wouldn't this encourage the building of more high rise parking garages?

You might even cause people to ride motorcycles of motorcycle with cars like the tango (http://www.commutercars.com/). It might create a market for safe motorcycles/scooters like the BMW c1 200.

Safer doesn't seemed to have helped the 3-wheel Piaggio MP3 sales all that much.

Where is the evidence that this is safer? I am extremely dubious.

Pentagon City Mall does charge for parking. I assume it is not the only one.

That's because otherwise a lot of commuters would park there, including those who work at the Pentagon and those who would catch buses and subway (Metro) at the Pentagon City stop, across the street.

Hmm, reading this from Europe feels strange. In cities, you have to pay for parking. Obviously. Why should you heavily subsidize parking space? What are the major societal positive extarnlitites from parking? Nowhere, rather the opposite. Pricing parking (as well as congestion, e.g. city tolls) have significantly increased quality of life in my European capital.

And paying parking with your mobile is now possible in D.C.? This has been possible in [pick random] North European city (small or big) for years...

I suspect this is more about different phone plans than parking. US cellular plans are almost all (except at the very lowest end) effectively all you can eat plans with a single payment and generally no additional fees. I don't believe this is the case in most plans in Europe, (due in part to calling party pays and other differences in telephone markets). Because most US plans are single payment, it was expected that everything else doned on the phone should be free. Only recently have things like apples app store begun to change how the the market expectations work.

Obviously. Why should you heavily subsidize parking space? What are the major societal positive extarnlitites from parking?

Faster, more comfortable, more convenient, more practical transportation. I would think that has large social and economic benefits.

Faster, more comfortable, more convenient, more practical transportation.

Not to sound unnecessarily snarky, but the word "externality" means external. Meaning not enjoyed by the user. You saying that parking has "economic benefits" says precisely zero about whether it should be subsidized.

I'm talking about external benefits. For example, I am more likely to be willing and able to work longer hours, more flexible hours, overtime, on weekends, attend off-site meetings, etc., if I have a fast, comfortable, on-demand car at my disposal than if I have to rely on a slow, uncomfortable bus ride and I'm a slave to the bus schedule. I can more easily run errands during my lunch hour. I can more easily attend to domestic emergencies that come up while I'm at work. I can more easily get to my volunteer job after work, or my child's band recital, or meet friends for social activities, etc. I have more time to spend at home with my family, because I spend less time getting to work and back. And so on. All of these benefits of car travel accrue to other people besides myself. Faster, more convenient, more comfortable transportation produces broad social and economic benefits.

If the government provided me with a Ferrari, I'd be more willing to drive to "meet friends for social activities." Hardly seems like a compelling reason for them to do so.

It seems unlikely that the public benefits resulting from the government giving a Ferrari would come remotely close to the enormous cost of the vehicle.

Alright, a less factious example. Should the government require utilities to provide me with free electricity? With electricity, I'm much more productive than I otherwise would be (in fact, I couldn't possibly work without it). Is that sufficient justification for something to be provided free? If not, why?

Alright, a less factious example. Should the government require utilities to provide me with free electricity?

Probably not, no. I'm not going to answer any more of these stupid questions. The point is that car travel produces substantial public benefits by enabling economic activity and social interaction that would not be possible if we had to rely on much slower forms of transportation.

The point is that car travel produces substantial public benefits by enabling economic activity and social interaction that would not be possible if we had to rely on much slower forms of transportation.

Major, who in the heck in this thread (other than Andreas Moser, maybe) is proposing doing away with cars?

I’m not going to answer any more of these stupid questions.

I'm sorry, but your failure to articulate an actual economic reason that parking is some special unique thing that absolutely must be provided for free (despite it's apparent astonishing, unsurpassed value to the user!) is not because my questions are stupid. It's because your economic theory is nonexistent. I'm probing you for an actual theory that goes beyond "I like driving" which explains why we are required to toss away everything we know about economics and adopt Communism for Cars. When you provide absurd explanations that would also imply that electricity should be free, perhaps you should consider that your theory is bunk.

Major, who in the heck in this thread (other than Andreas Moser, maybe) is proposing doing away with cars?

No one, as far as I'm aware, including Andreas Moser. Someone asked what positive externalities are produced by parking subsidies and I answered.

I’m sorry, but your failure to articulate an actual economic reason that parking is some special unique thing that absolutely must be provided for free

I never said parking "must be provided for free." It isn't provided for free. People pay for it directly through the purchase of parking space or parking fees, or indirectly through taxes or surcharges on goods and services. For the reasons I and others have explained, parking is not always priced separately and at market rates. This isn't likely to change.

If you're so concerned about transportation subsidies, why aren't you railing against public funding of mass transit? Fares cover only about 25% of the costs of public transportation. The rest is government subsidies.

The reason for parking requirements in Zoning By-laws is because not providing enough parking for your land use creates externalities. Young people buy condo's at the beginning of their earnings curve when they don't own a car and therefore buy a condo without a space. As their earnings increase they aquire a car but have no place to put it. They agitate for street parking and then the persons who did buy a space have their visitors displaced by residents who didn't buy a space. Good luck trying to price residential street parking at the market, here or in Europe.

Who is in the best position to decide what is enough?

In your example, that externality is created by people using a public commons for a private good (in this case, visitor parking). Why exactly should X be able to force Y to build parking Y might possibly use later so X can give free parking to his friend (or customer) Z?

I'm not sure why X and Y are supposed to be, but it doesn't matter who created the externality. It's still a problem. Hence the need for parking minimums.

Again, this seems like a very dodgy "externality". X desiring something for free and getting upset that the government no longer provides it stretches the word beyond recognition.

It's a cost to an external party. That's a negative externality. There's nothing "dodgy" about it. And absence of mandated parking minimums also causes negative externalities through increased free-riding on private parking. If the parking lot of the store I am visiting is full, I'll probably park in the lot of the next store over.

Serious question: If Starbucks declines to provide me a free coffee every day, is that or is that not a negative externality by your definition? After all, I'm harmed by their action to not provide a free good. Does that fact that I might instead use a coffee machine at work if I don't receive Starbucks coffee mean that the government should force Starbucks to give me coffee to prevent my employer from suffering the "negative externality" of me using their coffee?

Why do people lose their heads over parking? It's a service, pay for it. Shoup is right: "When men and women think about parking, their mental capacity reverts to the reptilian cortex of the brain."

And you do realize that all Shoup is advocating is the usual market system we use (in theory) in this country for almost everything, right? Not zoning, not banning cars, not banning building parking. Just allowing the market to work, like it does for haircuts, beer, computers, legal services, food, economics blogs, etc. What's the problem?

Serious question: If Starbucks declines to provide me a free coffee every day, is that or is that not a negative externality by your definition?

No of course not.

Why do people lose their heads over parking?

Most people seem reasonably happy with our current policies for regulating and funding parking. It's only people like you who seem to be losing their heads over it.

It’s a service, pay for it.

We do pay for it. For reasons that I and others have explained, we just don't always pay for it in the particular way that you want us to.

But WHY? Why is it not a negative externality under your definition? What it the relevant difference (other than massive status quo bias) between the service of parking a car and the service of receiving a coffee? What is it about parking that makes it obviously the case that the government should require businesses to bundle it in a way that they do for practically no other services. Again, no one is talking about banning parking. Only about whether government should require bundling.

But WHY?

Because separate pricing is often costly and unpopular, so we bundle the costs instead through taxes or surcharges. The same way we bundle the costs of roads and shopping carts. I've been over this repeatedly.

What is it about parking that makes it obviously the case that the government should require businesses to bundle it in a way that they do for practically no other services

Government doesn't require businesses to bundle it. Businesses are free to charge their customers a separate fee for parking. But they usually don't because separate pricing is costly and unpopular.

I'll let you have the last word, but I'll point out that your answer was completely non-responsive. You said "It’s a cost to an external party. That’s a negative externality." And I want to know what the limits of this rather radical new definition of a negative externality (the failure to provide a free good to someone else) is. The fact that charging for parking is "costly and unpopular" can't possibly be the reason.

And I want to know what the limits of this rather radical new definition of a negative externality

I'm not redefining it. The transaction between the condo provider and the condo buyer reduces the amount of public parking space available to other residents. That's a cost to those other residents. It's a negative externality of the transaction.

This is a tradgedy of the commons problem caused by unpriced/underpriced street parking. That can be fixed (see post).

Except that pricing street parking is costly and unpopular. That's why we generally don't do it except in dense areas where land is expensive and roads are congested.

Legislating oversupply is also costly. I would say more costly than the transaction costs of pricing street parking. And 'unpopular'? So are property taxes. Its a zero sum game in that respect

Legislating oversupply is also costly. I would say more costly than the transaction costs of pricing street parking. And ‘unpopular’? So are property taxes. Its a zero sum game in that respect

You don't legislate oversupply. You legislate adequate supply. I'd like to see your analysis demonstrating that mandated parking minimums produce costs that exceed their benefits.

Priced street parking is very unpopular. That's one reason why it's rare, and is likely to remain so.

If you end up with more than the market would provide, it's oversupply. Giving away free ice-creams on a street corner, and having your van emptied out, does not mean "one van-load per afternoon" is "adequate" supply (if adequate supply is to mean anything other than "demand at a price of zero").

Give me a single externality that not providing parking causes (a real one, not some "free riding" or "I'll work harder with free parking" faux externality). And then explain how it is worse than the externalities associated with driving in an urban area (there are real externalities with that activity).

I find it interesting that people are really keen on state central planning when it comes to parking. Often the same people who are nominally against that sort of thing.

If you end up with more than the market would provide, it’s oversupply.

Without a mandated minimum, businesses have an incentive to provide less parking than they need and free ride on parking provided by other businesses or street parking. That's a cost to other businesses and to local residents. If you think you can show that the costs of mandated minimums from oversupply exceed the benefits from reduced free riding, then do so. Simply asserting it is worthless.

Except that 'free riding' isn't an externality as other businesses and local government are *choosing* to provide unpriced parking.

Except that ‘free riding’ isn’t an externality as other businesses and local government are *choosing* to provide unpriced parking.

The fact that they choose not to price their parking is irrelevant. The free riding is an externality because it is cost to someone who is not a party to the transaction that causes it. If you seriously think you can persuade a business owner that he is not incurring a real cost when he loses customers because the parking space that he provides for them is being used by customers of his competitor next door, good luck.

Wrong. The relevant transaction is that between the car park owner and the parker.

Wrong. The relevant transaction is that between the car park owner and the parker.

Nonsense. There is no transaction between the car park owner and the parker. The parker is simply using the parking space without the consent of its owner, in order to conduct a transaction with someone else. If I park in KMart's parking lot in order to make a purchase at Walmart next door, the transaction is between me and Walmart. KMart is simply the victim of me using its parking space -- potentially displacing its own customers -- without its consent.

This will all be irrelevant in about 10 years. When driverless cars are commonplace, parking will not be much of an issue. Driverless cars will drop their riders off a the front door of wherever and then either find a distant and free place to park/wait or cruise the streets for a short while.

Sooooo we will have a bunch of driverless cars roaming the streets creating gridlock? sounds like a bigger problem than parking. And that is more like 20-30 years out (for them to become common).

No, the opposite actually. You won't have shoppers (dare I say, female shoppers) camping out at the end of a row of cars waiting for a close one to open up, when they could have driven 100 yards away and walked the distance in half the time they have been waiting and blocking traffic flow for everyone else.

You also won't have to worry about drunk or sleepy or eating or texting drivers not paying attention on the road. Speed limits can go up and following distances can decline because reaction times from automated cars will be 2 orders of magnitude quicker than for humans. So we'll have far less wrecks tying up traffic every time it rains or snows or the wind blows hard or the hockey game lets out, etc. Both traffic injuries and damage will drastically decline, lowering the cost of insurance and noticeably increasing life expectancy.

That's assuming the trial lawyers don't stop it all of course.

I think that's called a valet.

There are other factors already at work, too.

Increasing numbers of people shop online (think Amazon Prime and other "free" shipping offers), and increasing numbers of people are telecommuting 1 to 4 days per week.

There's a solid Coasian justification for most free parking. That's why malls have much more than any regulation would force them to provide.

Increase the cost of parking downtown, and you'll just cause people to do their shopping out-of-town more.

The proposal is to remove regulations, so the mall parking you describe would not change.

Parking costs downtown are increased only during times of high use, which ensures that visitors will always be able to find a parking spot.

Yes, but small stores near the malls would start free riding off the mall lots.

The small stores aren't doing any free riding. The malls choose to not price their parking directly. Its their choice.

Incorrect. Malls tend to place buffers between themselves and other sellers precisely to prevent people from free riding on their parking lots.

You missed my point. The malls choose to provide the free parking. Calling it 'free riding' by the small businesses as if they are somehow being unethical is ridiculous. Should the small businesses also be forced to provide toilets to prevent more 'free riding'?

@Swan:

Yes, but the small businesses provide the free parking for their own customers . Not as a public good. Their only shortcoming is that they do not police it diligently.

What's the big deal with parking? I don't drive myself but in every movie the characters, even in big, busy cities like New York or Paris, never seem to have to drive around the block to find a parking space or have any problem parking at all.

Drivers need real-time information as to where open spots are to be found. Circling around central business districts wondering where an open spot may be is much more irritating than walking an extra 70 yards.

An interesting semiotics problem: how do you communicate both open parking spaces as well as current pricing?

BT

An Apple App.

We will drive pretty decently far out of the way to avoid meters, but it's more for time and convenience reasons than the money. In Old Town Alexandria the meters on and near King Street only allow two hours of parking which is no where near enough time to have a nice leisurely meal and a drink. Consequently, since we moved out of walking distance of King Street, we don't really go there anymore. It's too much hassle.

Georgetown is a similar decision. There's no good public transportation there, traffic is terrible, and parking awful. Even if you pay for one of the parking decks, it takes forever to get in and out of them. I can't stand that place (for more reasons than outlined above, but that's another tale).

So, if parking is hard to find, time restricted, and extra expensive, I'm more likely to throw a personal fit and just not go than pay and search. Of those three annoyances I'll only take one at a time. In the meantime I'll continue to shop online and take the metro to games and museums, thankyouverymuch.

By adding more cost to the parking, you make some segment of the population do exactly what you will do - which alleviates the traffic and "finding a spot" problems. Bonus for everyone.

I wish they would raise the tolls on the bridges in NYC even more - I'd rather pay more money than sit in traffic for an extra 20-30 minutes.

I wish they would raise the tolls on the bridges in NYC even more – I’d rather pay more money than sit in traffic for an extra 20-30 minutes.

And with the more income if demand is still strong they could build another bridge.

No, no, Floccina, you miss the point. The object is not to make it easier to get to a destination in the city. It is to discourage the toiling masses from bringing their cars into the city at all. Urban auto travel should be only for the well to do! By the way, I'm the other Dan, not the Dan you are responding to.

Exactly. And then you have accomplished your "tax the rich" objectives.

-The "Other" Other Dan

"In the meantime I’ll continue to shop online and take the metro to games and museums, thankyouverymuch."

I think this is the point. By increasing the price of parking and displacing parking that was only there due to regulation, it pushes more demand to the public transit system.

For cities that don't have the transit system in place, it does create some growing pains as people have to pay more AND they don't yet have access to adequate public transit. Increased parking costs are not a big deal for places like Chicago, NYC, DC, and most larger European cities. However, in most midwest US cities it simply isn't convenient or even possible to get where you need to go on public transit.

The thing is though that I will only trouble myself for experiences - hockey games, museums, etc - that I can't have otherwise (sports in person is waaaay better than on TV). Shopping is something that's rather easily replaced convenience-wise by the internet. Going to a store only has to become slightly more annoying for the whole scale to tip in favor of not going to the store at all.

Georgetown parking seems pretty trivial to me. Roll into a paid garage, takes no time at all and very close to the shops/restaurants.

Anyway, these proposals would make parking easy to find. I don't know about time restrictions, but they seem unnecessary if the spots are priced properly, right?

Alex and Tyler only describe the one market distortion that increases parking spots: minimum parking requirements. Other, probably more important distortions, decrease numbers: limits on total construction and barriers to entering the construction business.

Current laws that limit what you can build but require that you use a certain amount of that total on parking (and, in Blue States, drive up construction costs by making it hard to enter the construction trade) create more parking spots than you'd get with no parking requirements but no other changes.

If, however, there were no maximums on what you could build on your land and construction was a competitive industry such that the observed costs of building things actually reflected the competitive prices of inputs and labor, people would build far more on most plots of land, including enough parking for anyone who wanted to park. Why would anyone discourage potential users with too little parking when there was no need to choose between lots of rentable space and lots of parking, particularly when parking garages are really cheap to build?

And why rally against this one tiny land use distortion when there are two massive ones, limiting what people can build on their land and inflating construction costs ten-fold in the areas with the most barriers to entering the construction trade?

Density creates negative externalities -- noise, congestion, crowding, pollution, litter, loss of privacy, loss of light and greenspace, etc. So people support limits on construction.

Most studies suggest that until you get really, really dense — more than 200,000 people per square mile — density has far more positive externalities than negative ones. The idea that majority support for some check on individual freedoms means that said check is rational is absurd. There are cases where the majority correctly support limiting individual freedom — laws against murder, for example — but there are many counterexamples. The externalities argument is also pushed past the point of absurdity. All actions have externalities. Not all should be regulated.

Most studies suggest that until you get really, really dense — more than 200,000 people per square mile — density has far more positive externalities than negative ones.

Please cite these studies.

The idea that majority support for some check on individual freedoms means that said check is rational is absurd.

Since no one has claimed otherwise, I'm not sure what your point is.

The externalities argument is also pushed past the point of absurdity. All actions have externalities. Not all should be regulated.

Again, no one has advocated regulating all actions that have externalities. If you believe that the negative externalities of density -- noise, congestion, crowding, litter, pollution, loss of privacy, etc. -- are not serious enough to justify regulations that limit density, you are free to use the political process to try and repeal those regulations. Given that such regulations are extremely common and longstanding, I suspect you will not be successful.

( a different Dan than the one above) Market pricing of parking might drive a lot of city dwellers to give up their cars. Or it might drive a lot of car owners to give up their cities. That was the trend of the 20th century. I suspect that the real plan now is to get a lot of middle income residents to give up their cars, and leave a less crowded cityscape for the more affluent drivers

Exactly - except replace "middle income residents" with "residents that don't value car travel as much" and "more affluent drivers" with "drivers willing to pay a steep premium"

-The "Other" Other Dan

Here we go again.

Do we pay air conditioning electricity fees for walking into stores? According to this, we should, because that stuff's not free!

There are two malls near me. One charges for parking, one doesn't. The prices are the same in the stores of each. So, where's the hidden cost of providing free parking in the latter?

I understand the concept of parking not being 'really' free, but as I mentioned above. neither are a lot of other things that are business costs.. Should we break down each and every one of them and force consumers to pay by the minute for them when they are out shopping?

"Do we pay air conditioning electricity fees for walking into stores? " Well, yes you do. It doesn't run for free.

"There are two malls near me. One charges for parking, one doesn’t. The prices are the same in the stores of each. So, where’s the hidden cost of providing free parking in the latter?" Since the one that charges stays in business, clearly some substantial portion of the populace thinks it's worth it to shop there.

"I understand the concept of parking not being ‘really’ free, but as I mentioned above. neither are a lot of other things that are business costs." That may be true for parking lots owned by the business directly that restrict parking to their own customers, but if it's street parking owned by the city then the issue is more complex.

The point is that most parking is cheap to provide and it therefore usually makes more sense to bundle it rather than price it separately. The same way stores bundle the cost of shopping carts, restrooms, grocery bagging, etc.

No one is saying they can't do that.

Yes you do.

The mall charges for parking, not the store.

Those who like this sort of change the most seem to be those who are hoping that someone else's behavior will change, allowing those who like the proposed change to keep doing what they are doing at a slightly higher price and with fewer competitors.

Since poor people who live in big cities do not own cars, free or below mark cheap street side parking is subsidy to the rich and middle-class. My rule is that you cannot effectively subsidize the middle-class.

"If developers were allowed to face directly the high land costs of providing so much parking, the number of spaces would be a result of a careful economic calculation rather than a matter of satisfying a legal requirement."

You ignore one huge fact: not all developers are sophisticated. There is a huge amount of mom-and-pop development and do not have the capability to do a "careful economic calculation."

Moreover, a building is (and should) be a very long term calculation. And calculating parking demand is here-and-now. If one is going to be conservative, better to provide a liberal amount parking. After all, if you have too much you can rent the surplus to someone else or even build on it (surface) or use it or some other purpose (in a structure.)

And without any perceived public commitment to mass transit, it would be irrational to build without what appears to be currently adequate parking.

None of that suggests that this discussion of parking is not beneficial.

In the early 1980's my employer moved his office from the edge of Hartford, in a mixed residential/commercial neighborhood, where the building included a ("free") parking lot in the back, to downtown, where there was a parking garage across the street, not affiliated with the landlord, that cost $3 per hour, up to $25 a day. Employees were issued a monthly parking pass, so we didn't have to pay separately. Shortly after that I took a vacation to Las Vegas.

Surely there is no real estate in the world much more pricey that the Las Vegas Strip. Certainly not downtown Hartord, which was decaying at the time, with prices falling faster than a 3-bedroom Phoenix ranch house in 2008. Yet, we had to pay for parking in Hartford, and every casino on the strip offered free parking. No validations or anything, just a free parking lot. Of course, you had to walk through their casino to get to the street, and to get back to your car.

"What's wrong with this picture?", I thought. Despite vastly more expensive real estate, the casinos were able to provide free parking and make huge profits, while the businesses in Hartford were dying and had not the good sense to avoid antagonizing their potential customers by nickel-and-diming them for parking. No wonder the mall in West Hartford was crowded on Saturday, and the same stores in the city were deserted.

Property behind the Strip wasn't so precious in the '80s. Frontage on Las Vegas Boulevard was valuable, but behind the hotels you could find golf courses or temporary Formula One racetracks and open-air boxing rings and stadiums.

There remain a number of sh*tty little establishments on the strip towards the North and South ends.

Many people are vehemently pro-free parking. I think this is because they really prefer to have the cost of parking built in to the cost of the goods they buy. The total cost of parking is the same, BUT it is only distributed over the shopping trips where something is purchased. People really hate spending $5 then coming away empty handed. You economists have a term for this, right? And someone showed that if people pay to shop they will further overpay, beyond their sunk cost, just to avoid going away empty handed?

I think the arguments against free parking win out here, but it seems like we should understand the psychology behind the free parking demands. I do not understand why people who write about parking never mention this (eg Tyler, Matt Yglesias and the comments above, I have not read everything that has ever been written).

It's fine for a business to offer free parking if that is what it decides. We're talking about mandating free parking/ lots of parking.

Where are businesses required by law to bundle the cost of the parking they provide to their customers rather than price it separately?

Parking minimums are needed to reduce externalities. Without a mandated minimum, a business may not provide enough, so its customers may poach parking space from other businesses or neighborhood streets.

My reply below was to Cliff, not sure if that is clear.

To major,
I think we are assuming that where there are mandates minimums restaurants/stores pass the cost of building/maintaining the spaces on to the customers.

As for the externalities I think that is very relevant. It is not an issue if there is no below market parking anywhere, which is probably what parking reformers envision. But maybe we end up at the present equilibrium thus: market rate parking -> customers demand free/cheap parking from retailers -> nearby business free ride -> mandated minimums.

I am pretty sure I am still for market rate parking prices. I can live with occasionally paying $5 to $15 to come home empty handed. I just think this is a stronger case to argue against than "people like mandated parking because they have no concept that they pay for it in higher prices and fewer retail options."

You could live with it but the stores wont like it. I'm betting you'd make fewer trips and buy lesser stuff. It isn't rationality as much as consumer psychology.

@Rahul I think a lot of people wouldn't like doing away with minimum parking reg. No doubt that is why they are so common. Consumer psychology is a good term for it. And since this bit of consumer psychology is well established it seems like advocates for doing away with the reg should address it.

True, but this works only insofar as "parking for patrons of store X only" regulations are enforceable. My first hand "research" suggests they are not, since I try to obey those signs, but sometimes I lapse if, say, the place I want to eat is out of spaces and a nearby bank has several. Thus far there have been no consequence. (Tip: park somewhere where they can't get a tow truck behind your car. This describes most spaces in most lots.)

If there is no way to enforce this regulation the only way for people to get below market parking at their favorite store is by minimum parking requirements etc.

Plus it is the consumer who (I say) wants the option to shop without buying anything or paying to park. It is possible the store does not place much value on consumers who come in uncertain about whether they will buy.

You need the mandated minimums precisely because parking exclusions are difficult (costly) to enforce. If every business is forced to provide enough parking for its own customers, there's less chance they'll free-ride on parking space from other businesses or local residents.

I think I type too slowly.

This is correct and to my mind the best argument for minimums. It does not quite win me over, but I think it deserves to be heard. To read, say, Matt Yglesias you would think there was no credible case to be made for free parking.

I rented parking from a building in Seattle once which had been hit hard by the city parking requirements. Those requirements were loosened five years or so ago, but for several decades it was 1.5 parking spaces per residential unit in most of the city (all but downtown I believe, which had no requirement). This particular building was an odd duck because it was an entire building of studio apartments. Most studio apartments in Seattle are occupied by one person, and in that neighborhood a lot of people don't have cars, so 1.5 parking spaces probably around 3 times too many for the building. That was the only building entirely of studio apartments I ever encountered in the city, and it was pretty ridiculous. I think it was almost half parking garage. It had 4 underground levels! (small ones). That building I rented the parking space from for a while always had "parking for rent" signs up, much less frequently "apartment for rent"... oh and man was a parking space cheap. $50 a month, I think, for garage (so 1/10th or so the cost of an apartment). They did seem to keep it pretty full, it was in one of the harder neighborhoods for street parking (lots of apartment buildings from before the parking requirement in the area). I have to think that since I never saw another building like it it's owner did not become fantastically wealthy off the parking income and open up similar buildings all over the city.

During the campaign to get the parking requirements relaxed developers said there was lots of demand for studios and small apartments, but it wasn't cost effective to build them with the parking requirement. Part of it is that with a limited lot building parking means making the building taller. Making the building taller makes the building more expensive at a faster rate than it adds floors (a 4 story building is more than twice as expensive as a 2 story building).

I'd say Mr. O'Connell's a good representative of how 'the average American' thinks about parking policy and why we're basically screwed. Hmm, in what ways are the Las Vegas Strip and a a mixed residential/commercial neighborhood in Connecticut a tad different? Think hard, Mr. O'Connell.

And, of course, Hartford is a particularly good example of a city that's been torn apart by parking lots:
http://blogs.reuters.com/felix-salmon/2011/11/17/parking-datapoints-of-the-day/

I can easily afford to pay for parking (central zone of a city of 3,000,000). If the price of parking doubled or tripled, I could still afford it and my life would be more pleasant: fewer proles in the shops and restaurants.

Fewer proles in the shops and restaurants means fewer shops and restaurants, and your life would be less pleasant.

A web of government policies makes the purchase of a car nearly mandatory in most of the United States. Since this is a given, the least the government can do is to through its citizens back a few bones in the form of subsidized parking and subsidized gas.

That said, the original post was focused on requiring private developers to provide for parking and I think this is bad policy. There are lots of other ways that the government could ensure that people pay less than the market price for parking, if that is its objective, and nearly all of them are better.

A web of government policies makes the purchase of a car nearly mandatory in most of the United States.

If people wanted policies that were less favorable to cars, they'd lobby and vote accordingly. Cars are so common because they are immensely useful, not because they have been forced on an unwilling population by the government.

One reason cars are immensely useful is that the government provides roads.

The government provides roads because the people want it to provide roads. Cars have become the overwhelmingly dominant mode of transportation not just in the United States but in every country rich enough for cars to be affordable to the general population. Car haters need to get past this nonsensical idea that our car-based transportation system has been forced on an unwilling population by government overlords, instead of being the natural outcome of technological and economic development..

Exactly. People also want goverments to provide places to park those cars.

>>>A web of government policies makes the purchase of a car nearly mandatory in most of the United States.<<<

Government? Not geography?

No on seems to have mentioned the unmitigated disaster that this variable parking system would be. It's one thing to have high rates or low rates. It's a completely different thing to have rates that a complete mystery to the user until he arrives at his or her destination. It will only take a few instances of people heading to downtown or Beverly Hills, Melrose, or wherever and be hit over the head with a parking rate of $18 for a few hours shopping and lunch for them to avoid the area altogether. One day you meet friends for lunch and it's $1 in quarters, a week later you go to meet friends it and it's $6 on your credit card. No one wants to drive 45 mins in traffic without knowing if they will be able to park without doubling the cost of their lunch.

At least, if the price was always $6 per hour, the shopper would be aware before hand to affect choices. Maybe they still go but carpool. Maybe they meet at Melrose once a month instead of once a week. But as a mystery price?

Are arguments for pricing parking also arguments for putting a price on using the roads that lead to the carpark?

"Shoup would open those residential blocks to market-priced meters, wooing home owners by guaranteeing that meter profits would be turned over to them in the form of property tax deductions. (That benefit could add up to thousands of dollars a year per household.)"

In reality, Parkinson's law would apply. The parking wardens' salaries and pensions, and other costs would simply rise to soak up all available surplus, leading to no money left for tax deductions. Most residents are aware of this and won't fall for the bait-and-switch.

I never understood why we allow car owners to take up so much of our public space for so little for a product that they rarely use more than 2 hours a day. The rest of the day, it just sits around, uses up space and is ugly.
Our cities could be much more compact and/or green were it not for these millions of ugly cars.

Just one reason why I went car-free: http://andreasmoser.wordpress.com/2010/10/02/car-free-by-choice/

I never understood why we allow car owners to take up so much of our public space for so little for a product that they rarely use more than 2 hours a day.

Cars are very useful, despite spending so much of their time parked, and there is lots of public space. Only a minute fraction of public land is used for parking.

Our cities could be much more compact and/or green were it not for these millions of ugly cars.

We don't want compact cities. We want low-density cities so that we can have spacious, affordable housing, the comfort and convenience of car travel, and a more pleasant urban environment (less noise, less congestion, less crowding, less pollution, more privacy, more light, more greenery, etc.).

1. All all cars are ugly? As compared to what?
2. How many products do you own that you use more than two hours a day?

I agree there's a strong case for public transportation, car pooling etc. but car-free is still a fringe choice for most of us.

Any questioning of the Right to Park Without Charge [117th Amendment to the US Constitution?] evokes visceral responses, doesn't it?

This is due to the phenomenon that once people are used to a price level of zero, they will refuse to pay. Suburbanites are not used to paying for parking but when they go into an urban, downtown area, they really resent having to pay at places like stores, theaters, restaurants, universities, and Hospitals.

Look at how people refuse to pay for access to internet informaiton or even breakfast at a hotel.

Without perfect information, it seems like price volatility can be as problematic as inefficient price levels.
If every time I leave the house, I can't bank on the price *not* being $6/hour, then as a risk-averse parker, I may end up making decisions based on an almost-always-false assumption that the price is very high.

If this scheme is implemented -

1. Prices for goods and services will be no lower in the local stores.
2. The price mechanism will force only those who have the means to pay for parking to park and prevent the bottom 60% from having much of an opportunity.
3. It will make the owners of the parking lots rich.
4. It will reduce the quality of life of the average shopper who currently can find a space to park.

I love this blog but whenever it talks about automobiles, road space and parking it starts spouting out scary stuff.

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