Tuesday, June 24, 2014

Monkey Wash, Donkey Rinse?

There aren't enough parking spaces.

People drive around looking for parking spaces.  They waste lots of time, gas, and atmosphere doing it.

Is there a more efficient way to do it?

Monkey App thinks so.

San Francisco thinks that that is illegal, and since San Francisco has guns (and tanks, actually, a large private army with enough force to take over some countries), San Francisco can prevent Monkey App from operating.

Some questions:

1.  Can I hold a parking space for someone else?  That is, can I park, wait until other person arrives, and then move out of parking space?

2.  Suppose it's an hour before my friend arrives.  Can I pay for three hours, and allow my friend to use the remaining two hours when she arrives and I pull out?

3.   Would it be acceptable for my friend to pay me for the two hours?  At the rate I paid for it, that is, the parking meter rate?

4.  Could my friend pay me for the time I spent waiting? 

5.  Suppose someone pulled up and just wanted to park for 15 minutes, during the hour I was waiting.  Would it be okay for me to let THAT person use the space?  Could the person pay me to pull out so that person could use the space?

If you answer "yes" to number 1, you are saying that deadweight loss is okay in allocation, because I am "wasting" an hour of parking by holding the space, when in fact I don't want to park there.  I just want my friend to be able to park there, when she arrives.  Someone else would have parked there if I had not taken the space.

The counterargument is that people will go into the business of staking out parking spaces.  It's exactly the same problem as ticket scalping.  People who don't want the asset will hire folks with low opp cost of time to wait in line and buy up the asset.  Then it will be resold.  Much of the value of the rent (the scarce resource) will go to the scalper.

The difficulty is that I think the answer to questions 1 and 2 above are "yes."  The only problem is if I get paid.  I can donate the "favor."  But making money on the deal makes it illegal.  Euvoluntary?

1 comment:

  1. And, of course, the "money" aspect of it is always challengingly difficult for people to understand.

    What if I held a parking space for someone, refused to charge them on the spot for the space, but later the person saw me at a bar and bought me a beer for holding the spot for them. The pint might cost $5. Is that any different than a person handing the initial parker $5 on the spot?

    And what if a norm, not a formal contract but an accepted informal mode of behavior, developed wherein anybody who had someone hold a parking space would be morally obligated to buy the other person a beer?


Do you have suggestions on where we could find more examples of this phenomenon?