If Congestion Pricing Is So Great, Why Don't Businesses Do It?
Congestion pricing and/or express tolling is one of those things that seemingly all men of good will--i.e., liberal, conservative, and libertarian policy wonks living in a handful of coastal cities--can agree about. Most non-wonks seem to hate it. But it promotes environmental goals and controls negative traffic externalities by using prices. What's not to love?
A few days ago I happened to stop by the local supermarket during the post-work rush. When I was ready to check out all the regular lanes had long lines. Ordinarily, I wouldn't mind waiting a few minutes, but on this particular evening I had dinner plans I couldn't be late for. So I shelled out the extra $6 for the express lane so I could skip the lines.This is a strong empirical argument, and Tim goes on to outline reasons he thinks that we don't see congestion pricing in grocery stores. But let me counter with my own example: I do pay to cut in line when I use another form of transportation, namely flying. When I fly Southwest, I buy the pricier tickets that put you at the head of the line (worth it, because Southwest's seating is first-come, first-served). When I fly out of a very congested airport like Dulles, I will occasionally pay the $20-40 to go through the shorter first class security line, and jump into an earlier boarding group. And wherever possible, I fly American Airlines, where I have Gold frequent flyer status. Why? It lets me jump the lines.Perceptive readers will surmise that I made up the previous paragraph. In reality, grocery stores don't impose congestion charges on their customers. Nor do many other types of private businesses. I don't think I've ever had a customer support line offer to expedite my call for a fee. I've heard you can get a table faster at some restaurants by bribing the Maitre d', but I've never seen a restaurant formalize the practice. Generally speaking, when businesses experience temporary spikes in demand, they serve customers on a first-come-first-serve basis; they don't auction off the temporarily scarce capacity to the highest bidder.
These examples came to mind as I was reading the comments on my recent article about congestion pricing of the highways. One of the striking things about the congestion pricing debate is the stark divide between elites and the general public. Prominent intellectuals from across the political spectrum--from free-market transportation experts to left-wing bloggers are supportive of the idea. In contrast, the readership of Ars Technica, like voters generally, is overwhelmingly opposed. And their criticisms were not limited to the privacy issues that were the focus of my article.
Many supporters of congestion pricing chalk this up to voter ignorance. They assume that people will like congestion pricing once they have a chance to try it. But the supermarket example should make us skeptical of that conclusion. The grocery business is an intensely competitive one. If it were true that people could be won over to this kind of scheme once they had a chance to try it, you'd expect some entrepreneurial grocery store owner to give it a try. Yet I've lived in half a dozen different metropolitan areas and I've never seen a supermarket that utilized congestion pricing on its checkout lanes.