Robin Hanson wrote: >Why not let those who want to trade parking futures?
This is an interesting, clever suggestion, but it still strikes me as a bit Rube Goldberg-ish. I have a feeling that regardless of the state of current or future technology, a preannounced, fixed (but occasionally modified) tariff of parking rates that is set at the proper level will bring almost as much gain in efficiency as a variable tariff but at a significantly lower social cost (especially when search costs and customer frustration are considered). After all, if variable pricing were such a wonderful idea, wouldn't supermarkets charge $20/gallon for milk whenever the TV weatherman said that a blizzard was coming? I'm not convinced that the technology to make a variable tariff economically optimal really exists yet (or if it exists it's not ready for prime time). It's not enough to have meters that can set real-time efficient prices; it's also necessary to have some convenient way for customers to find out what those prices are at any moment (presumably an Internet connection in your car or something equivalent). Otherwise, you wind up driving around stopping at parking spaces to look at the fare and then having to go somewhere else and repeat the process until you find a space that costs a price you're willing to pay, and all the while you curse the person who thought up this crazy parking system that has all sorts of empty parking spaces that you can't use. I suspect that parking meter owners would find it more profitable to have a preannounced tariff. This wireless information service in your car will cost money, which will lower the money that customers can spend in parking meters. A fixed tariff would allow the owners to capture more of the social surplus. Also, fewer customers would be alienated into never coming back. Respectfully, James Haney
