Parking and congestion

It is not too rare to see Indian politicians and policymakers talking about imposing congestion charges on Indian roads in order to control traffic.

The basic idea is pricing based on demand and supply – since supply of road space is constraint, and demand is increasing by the day, the use of roads in certain parts of cities (typically central areas) gets priced. This way, not only does this control the flow of traffic, but also nets revenue for the city.

In Indian cities, thanks to the numerous “cross roads” which can provide arbitrage opportunities, congestion pricing is hard to implement. However, there exists a fairly simple way to price road space and dissuade people from using private transport – charging for parking.

It’s such a simple and intuitive concept that it is a wonder that we need this blogpost (and this) at all. And in some ways, we can think of charging for parking as the “dual” of charging for congestion. Instead of charging for road space through the journey, we charge the ends.

This is of course an imperfect solution – it still doesn’t prevent people from driving through an already congested area with high parking charges, but it is at least a start.

The incremental impact of charging for parking can lead to a reasonable dip in traffic. It will also prevent people from moving around slowly in search of a parking spot (anyone who’s seen congestion on Brigade Road in Bangalore will attest to this). And as anyone who has tried to park a two wheeler in Bangalore will tell you, monitored parking spaces result in significantly better utilisation of parking space.

And then there are benefits to the government. The city government makes money (Takshashila had a paper on this a while back, but I’m not able to find it now) which is not small. The ability to regulate and charge for parking lets people know that the city government is capable of regulating traffic.

What’s more – once basic pricing is introduced, more innovative solutions will be found by the market. We might have apps that lead to pre-booking of parking space at your destination. We might have apps that lead parkers to the nearest empty parking space, thus cutting congestion on roads. We might even have a marketplace for parking space! All of this must be compensated for, of course, and unless parking itself is charged for, such businesses cannot function.

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