Content area
Full Text
A common problem at major university campuses in the United States concerns persistent parking space shortages. While such a situation reflects an inadequate pricing mechanism for parking, it also reflects a result consistent with monopoly providers of parking services. In this paper, we analyze the parking problem from this perspective, utilizing a cost-benefit approach that explains why the incentive structure that exists at American universities makes such problems likely.
(ProQuest: ... denotes formulae omitted.)
INTRODUCTION
A persistent complaint on college campuses today centers on the issue of parking. Parking space is either insufficient for drivers' demand, poorly allocated, or both. The question, "Did you have a hard time finding a parking spot?" is asked as often as, "Did you go to the library last night?" In our experience at educational institutions, for parking not to be a problem at a major university campus, especially when compared to most private sector alternatives, would be the exception rather than the rule.
Part of the problem lies in the value of an individual parking space. Shoup (2005) calculates that a new parking space in the United States cost 17 percent more than a new car, and that in most cases, parking spaces cost more than the cars parked in them, in part because cars depreciate in value faster than parking spaces do. If this applies to urban areas in general, how much more would this apply to university properties in particular, which are bounded and often a small portion of a greater metropolitan area? The marginal value of parking spaces on university property is likely much higher.
That university parking problems constitute a special case probably explains why this particular issue has escaped much of the recent literature of the economics of parking (Shoup, 2006; Roth, 2004; Cathrop, 2002-2003). Historically, parking did not become an administrative problem until the post-war boom in college enrollments (Kinne, 1961). By the 1960s and 70s, many major universities begrudgingly allowed for the construction of mammoth parking garages situated as close as possible to the main campus areas. While schools have adjusted to the evolving parking demands, they always seem to be one or two steps behind the demand. The case of Auburn University (in Alabama) is typical. In 1978, it published...