Sort of like lunch, there is no such thing as a free parking space. It costs us dollars or time.
Hoping to optimize so valuable a commodity, some cities are installing parking devices that use demand and supply to price spots. The approach resembles a variable pricing model where a good becomes more expensive when less is available. Others, concerned about the time we waste have apps that instantaneously identify empty parking spaces.
Now, we can add Parking Panda.
Like any market maker, Parking Panda pairs people with parking spots and those who need them. Anyone who has a parking spot can enroll. You might own an office building with a lot that is unused over the weekend or have a home with a driveway you would like to monetize. Whatever the reason, by enrolling with Parking Panda, someone looking for parking can find you.
Our bottom Line: Isn’t it fascinating how the market system, with no direction from government, can satisfy people’s needs and make a community more efficient?
Sources and Resources: Thanks to Slate where I first learned about Parking Panda. Also, here is the classic Donald Shoup paper, ”The High Cost of Free Parking,” an econlife post on San Francisco parking solutions, and a recent NY Timesarticle on their progress.
How about thinking economically when you dry your hands?
Pulling together 12 studies on hand-drying, Mayo Clinic researchers did a cost benefit analysis of paper towels v. hot air. Because they were most concerned with hospitals and other health care facilities, bacteria were a top topic.
It was not even close. Cloth and paper towels provide more bacteria protection than a hot air dryer after we wash our hands. One reason is speed. We tend not to wait long enough with hot air to dry our hands and thereby retain more bacteria. Furthermore, the air from a dryer propels bacteria. Specifically, after 10 seconds of drying with a towel, 4% of the water remains. However, it takes 45 seconds with hot air to get the water residue down to 3%. We should note though that jet dryers do dry hands as efficiently as towels but have other hot air costs, people prefer towels, and hot air is probably more environmentally friendly.
Our bottom Line: There is no free lunch. Looking at the world economically involves recognizing the tradeoffs that our decisions necessitate. Whether the subject is hand-drying, federal entitlements or investing, comparing cost and benefit can lead to optimal choices. As always, economics is about a lot more than money.
Sources and Resources: Consistently excellent, the Conversable Economistblog was the source of my hand-drying example and a summary of this Mayo Clinic paper. For part 1 of “Unexpected Economics,” the hand washing section is here.