My post, yesterday, on parking meters in Providence elicited a fair bit of response, notably in a run of tweets by James Kennedy, who directed me to a free-market-focused piece by Donald Shoup at Cato.  Both make interesting suggestions, but I think my basic point is being overtaken by an existing debate.

As a first and overriding purpose, why does a city charge for parking?  Whatever the answer may once have been, it certainly seems as if it has become the raising revenue, and that may be an inevitable problem.  If that’s the purpose, then the incentive can become to produce fines, not regular fees, because they are each so much more valuable.  (And before we know it, cities will be asking for the ability to withhold passports.)

If parking is ultimately a revenue proposition, then the question is why we should entrust it to government.  Even if there were a direct, restricted account to use parking revenue to fund public roadways, people who park are not the only ones who benefit from the roads.

For instance, parking is a disadvantage that stores and other businesses located in cities have against those in the suburbs.  One could say that the city government has to manage the parking as a means of assisting the local economy for the good of all, thus providing the rationale for government ownership of the means of parking, but this is simply a subsidy to the businesses.  If it’s advisable, it isn’t clear why shoppers should bear the brunt of the cost. Additionally, government introduces new problems.  If parking becomes a fine trap, that amplifies the incentive to stay away, not merely for the cost, but also for the sense of injustice.

Shoup answers the question as one of traffic management, and he sees meter fees as being a variable way to price the value of the parking.  If every block consistently has one or two spaces open, one knows that the pricing is matching demand while cutting down on the time people spend driving around.  Again, the problem is the incentives for the fee collector.

Under no threat of going out of business, a city government has relatively high incentive to impose fines as well as a relatively high probability of collecting them.  This affects the real or perceived price of parking.  Shoup’s plan might theoretically sidestep the problem by reducing instances of fines, but then why entrust government as the price-setter?

This isn’t an area in which I’ve got a great deal of specific knowledge.  About the best that can be advised, as a matter of general policy, is that each city should muddle through and figure out what works best or is at least most amenable to the local community.  In that process, keeping traffic management as the point of concentration should be a repeated reminder.  Locals should also keep in mind that planners can develop too-clever solutions that pay insufficient attention to the entity collecting the money.