Free Parking versus Free Markets

Saturday, February 25th, 2006

In Free Parking versus Free Markets, Dan Klein reviews Donald Shoup’s The High Cost of Free Parking:

The book is marvelous and wonderful. It explains that parking policy is stuck in a self-feeding cycle. It brilliantly criticizes the culture of parking policymakers. It tells all facets of the history. It provides theoretical underpinnings. It displays rich empirical evidence. It makes novel connections and illuminates old issues. It bubbles with illustrations, cultural allusions, and ripe quotations. And its 734 pages are gracefully written. It is one of the best policy books I know. The book represents a life-work in understanding the problem and enlightening the public.

The meat of the review:

Fundamentally, the policies in question are just two: city governments (1) mismanage curb parking and (2) require developers to provide extensive off-street parking.

Pesky policy-wonkery? Shoup shows that the magnitudes are huge. About 87 percent of all trips in the U.S. are made by personal motor vehicles, and parking is free for 99 percent of these trips (p. 590). But free parking is not a spontaneous outcome. The required parking lot at a restaurant usually occupies at least three times as much land as the restaurant itself. Shoup reckons this a subsidy to parking, and estimates the U.S. total of such subsidy between $127 billion and $374 billion a year. “If we also count the subsidy for free and underpriced curb parking, the total subsidy for parking would be far higher…. Do we really want to spend as much to subsidize parking as we spend for Medicare or national defense?” (591)

Like freeways and free schooling, free parking isn’t free. “We don’t pay for parking in our role as motorists, but in all our other roles — as consumers, investors, workers, residents, and taxpayers—we pay a high price” (2). Meanwhile, when motorists drive downtown and cannot find a parking spot, they curse and increase congestion. Exactly like on freeways.

The extent of free parking is so enormous and so normal that people just think it nature’s endowment, like air. Everyone feels entitled to free air and free parking. Hence, “most people do not see it as being any subsidy at all” (591). “Because parking costs so much and motorists pay so little for it, the hidden subsidy is truly gigantic” (591).

(I’ve blogged on The High Cost of Free Parking before.)

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