Monday, August 12, 2013
Parking Meters and Yield Management
San Francisco has experimented by converting about a quarter of its parking meters to "smart meters" in which the price depends on current demand. SFpark, which uses the smart meters and ground sensors to measure parking occupancy and adjust prices accordingly, is providing valuable lessons for San Francisco about reducing the amount of time drivers spend cruising the streets for a parking space.The people running the trial have published the first results here. This experiment also allowed them to calculate price elasticities at different locations and times.This one is taken from a blog entry about the paper.
Hat tip: Mark Perry
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This is a fascinating case of using prices to determine the supply and demand. I recently read about this in WIRED, and now you can pay using your phone! Broadway needs some of this technology.
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This is an interesting way to use elasticity to determine the pricing of the meters. By following this data, it not only helps determine what the price of the meters will be, but it can also be used for surrounding to track the traffic flow. By planting these points, they are able to create a demand curve graph and track consumers need for parking throughout the day. This shows us which part of town has the highest parking rate and what time, parking prices should the highest. This experiment would show that the price of would not affect the demand of the meter because it is inelastic. In other words, people are going to pay to park no matter what because they need to be in a specific area. This will also show what will happen when prices get to high, such as finding alternate routes which may drive the pricing of the meters down.
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