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Regulating on-street parking

Author

Listed:
  • Edward Calthrop

    () (Community of European Railways (CER))

  • Stef Proost

    () (K.U.Leuven-Center for Economic Studies - CORE, UCL, Belgium)

Abstract

Consider a shopper or tourist driving downtown and trying to park. Two strategies are usually available: either park at a private off-street facility or search for a cheaper on-street spot. We formalise such a setting and use the model to study optimal government regulation of the on-street parking market. It is shown that the optimal on-street fee equals the marginal cost of off-street supply at the optimal quantity. If the off-street market is supplied under constant returns to scale, this provides a particular simple operational rule: the price on street should match that off street. We also extend the model to consider maximum length of stay restrictions and non-competitive private supply. A numerical model, calibrated to central London, investigates the magnitude of an optimal fee.

Suggested Citation

  • Edward Calthrop & Stef Proost, 2004. "Regulating on-street parking," Energy, Transport and Environment Working Papers Series ete0410, KU Leuven, Department of Economics - Research Group Energy, Transport and Environment.
  • Handle: RePEc:ete:etewps:ete0410
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    References listed on IDEAS

    as
    1. Carl Davidson & Raymond Deneckere, 1986. "Long-Run Competition in Capacity, Short-Run Competition in Price, and the Cournot Model," RAND Journal of Economics, The RAND Corporation, vol. 17(3), pages 404-415, Autumn.
    2. Anderson, Simon P. & de Palma, Andre, 2004. "The economics of pricing parking," Journal of Urban Economics, Elsevier, vol. 55(1), pages 1-20, January.
    3. Sundaram,Rangarajan K., 1996. "A First Course in Optimization Theory," Cambridge Books, Cambridge University Press, number 9780521497190, December.
    4. Guesnerie, Roger & Roberts, Kevin, 1984. "Effective Policy Tools and Quantity Controls," Econometrica, Econometric Society, vol. 52(1), pages 59-86, January.
    5. Calthrop, Edward & Proost, Stef, 2006. "Regulating on-street parking," Regional Science and Urban Economics, Elsevier, vol. 36(1), pages 29-48, January.
    6. Arnott, Richard & de Palma, Andre & Lindsey, Robin, 1991. "A temporal and spatial equilibrium analysis of commuter parking," Journal of Public Economics, Elsevier, vol. 45(3), pages 301-335, August.
    7. Arnott, Richard & Rowse, John, 1999. "Modeling Parking," Journal of Urban Economics, Elsevier, vol. 45(1), pages 97-124, January.
    8. Glazer, Amihai & Niskanen, Esko, 1992. "Parking fees and congestion," Regional Science and Urban Economics, Elsevier, vol. 22(1), pages 123-132, March.
    9. Sundaram,Rangarajan K., 1996. "A First Course in Optimization Theory," Cambridge Books, Cambridge University Press, number 9780521497701, December.
    10. Verhoef, Erik & Nijkamp, Peter & Rietveld, Piet, 1995. "The economics of regulatory parking policies: The (IM)possibilities of parking policies in traffic regulation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 29(2), pages 141-156, March.
    11. De Vany, Arthur S & Saving, Thomas R, 1977. "Product Quality, Uncertainty, and Regulation: The Trucking Industry," American Economic Review, American Economic Association, vol. 67(4), pages 583-594, September.
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    More about this item

    Keywords

    Parking; Regulating urban transport; Search.;

    JEL classification:

    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy
    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods

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