Poor Economic Intuition, Example #5325

Yet another example of "folk economics", ie poor and consistent economic intuition. My employer, Google, is growing quickly, which causes occasional infrastructural problems. The latest of these is a parking crunch, and I'm one of the worst-hit by it because I get into work towards the late end. My nice 10 minute commute has turned into 30+ minutes of commuting, looking around for parking, finally finding a spot that might or might not actually be ours, and then the long walk to my building. Now, here's the bad economics: when I tell this to co-workers, the almost universal reaction is "Come in earlier".

If you take a minute to think it through, you can see that this advice is not merely useless, but counterproductive for the company. Sure, it helps me. But all my gain comes at the expense of whoever was getting in just before me! Viewed from a company perspective, that's a zero-sum game - we can't all come in earlier than each other.

But wait, it's even worse, because this advice leads to a net loss! If I move my schedule more towards the center of the arrival distribution, that *decreases* the total amount of time that the parking lot is utilized for, which means it supports less car hours per physical space. I'm contracting the amount of parking available. The correct advice is to come in later - after the early people have started to leave. That expands the amount of parking available, increasing utilization of this scarce resource.

Now, maybe my reaction here indicates that I'm too utilitarian, too obsessed with designing efficient systems. Perhaps the problem here is not lack of economic intuition, but the assumption of individual selfishness. Yet as someone who loves markets, but does not trust them unreservedly, I constantly ponder when and where selfish behavior leads to efficient outcomes. And here, the behavior that gains both me and the group is the opposite of "common sense".

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I agonized over posting a

I agonized over posting a comment, but I can't resist -- Shakespeare wrote a play about this issue: it's called "Much Ado about Nothing."

Just one girl's humble opinion. :roll:

I don't understand why, if

I don't understand why, if you did start arriving earlier, it would be "at the expense" of the even earlier birds. Most likely they're not rushing to work before you simply to get a better parking space; if it's anything like where I used to work, people arrive early for a variety of reasons. You didn't say exactly how you pitched the complaint to co-workers, but if they interpreted it as a question for how you could get a better parking place, the advice seems quite sound to me.

Personally, I would have added that you consider riding your bike to work. It should appeal to you, qua consequentialist: there are well established health benefits to *you*, and incidental, albeit tiny, benefits to society.

if you buy an adorable lung

if you buy an adorable lung t-shirt adorable privatized lung might creatively make more parking space for you in the morning. (can you park on puddles of molten car?) slight radiation danger.

lung

(offer void where prohibited by nsa, or if you do not live in world-l)

Sounds like if someone built

Sounds like if someone built a parking garage they'd clean up.

Or if google took the

Or if google took the initiative and started charging market price for its spaces. They're free, right? This is just another tragedy of a commons.

We used to have a name for

We used to have a name for this: the fallacy of composition.

A Good Reason to Love

A Good Reason to Love Economics
...it can justify showing up for work later.

Of course, at this point, I'm really looking forward to the day when I have a real career-type job to show up for at all, early as it may be.

RKN - your argument is not

RKN - your argument is not appropriate to our particular lots. Our parking lots are spread out, and cover a lot of area around a lot of different buildings. Hence the difficulty of finding a spot, and the amount of time to walk to the office from there, increases monotonically with how full the parking lot is.

There isn't a single 500 person lot, there is a 200 person lot (itself made up of many sections), a 100 person lot (in a big ring), many 50 person lots, and so forth. As the lots get full, free spots are scattered around (people work in different buildings), and so as the # of free spots declines, the time to find them increases. It's pretty obvious. And time is, of course, an economic expense.

Yes, its a small difference from 400 to 401. It's a probabilistic difference (depends on which spots you go look at). But its a real difference, just like that from 500 to 501.

And as for the cost measure, how can the walk to the office not be part of the cost of parking? That would be a silly thing to ignore!

I share your problem. Where

I share your problem. Where I work, there is no set time to arrive. Some people arrive at the crack of dawn, and others arrive as late as 9:30 (the upper limit, which is still a bit too early for me). In general, people generally don't arrive early for the parking; the early people arrive early because they prefer to work their 8 hours and get out early in the afternoon or perhaps because they are "morning" people and they are simply more productive in the morning.

On the one hand, there is some benefit to the individual in that it allows people some freedom in choosing when they arrive at work and doesn't force people into a "one-time-fits-all" schedule. The side-effect that you described is the unfair parking advantage enjoyed by the early arrivers. It seems to me that the only solutions are to A) suck it up and just get in earlier (people after you be damned) or B) for Google to build a parking garage. Unfortunately, the idea of coming in after people start to leave is probably not feasible for Google. If half of your office is arriving while the other half is leaving, it's not going to be very easy to schedule a staff meeting.

Or later.

Or later.

From a (naive) company

From a (naive) company standpoint, the earlier people get there, the more work they do, so the limited parking space seems like a good thing.

Still, since the stakes are so small, other factors would seem to swamp the limited parking space factor.

In any case, you are under no obligation to make someone else's parking situation easier at your own expense.

P.S. CS Lewis pointed out the difference between the positive virtue of Charity vs. the negative term Unselfishness in his book The Screwtape Letters. The audiobook read by John Cleese is a laff riot.

RKN - the parking situation

RKN - the parking situation is a function of the number of people present, one which monotonically decreases in ability to find a spot. If I show up as #400 of the day instead of #500, then the previous #400 now has the parking problems of #401, #401 now has the parking problems of #402, and so forth up to #499, who now has the same situation I used to have. Yet the total parking pain for employees as a whole has not changed, since its just the sum of this function over all employees, which means over all arrival #s.

The parking problems certainly enhance the bike option. But while that system has some benefits, saving me time in the morning is not one of them, since biking takes at least as long as driving and then looking for a space. And what I really want is a fast commute, not a healthy one.

Leonard - you are right that its a tragedy of the commons. Incentive to not drive is based on when your body likes to get up, rather than how much you value driving.

Dave - the problem is quite recent, and I expect management will do something about it before someone could build a new parking garage.

I don't know that I buy the

I don't know that I buy the "monotonically decreases in ability to find a spot" premise.

Assume a lot size of 500 vehicles. I don't see a measurable economic expense ("parking problem") imputed to #401 (formerly #400), since there are still 100 spots left when she arrives. Before you started arriving early there were 101 available to her, but that doesn't present a practical increase in difficulty for her, nor, I would argue, an additional "economic expense."

And so on, until the lot is nearly full, but even then as late arrivers learn and get wise to which spots are most likely to fill last, they can immediately try those first.

Now, I would concede that commuter #500, who becomes #501 perforce your decision to arrive early, does incur an added expense if she has to drive to a completely different lot. So in fact your decision to begin arriving early creates an added expense only for former commuter #500.

You might argue that the best spots have the shortest walk to the office, but that's a different cost measure than the ability to find a spot in the first place.

What about the margins? I'm

What about the margins?

I'm assuming, since you work at Google, your co-workers aren't just mindless robots that, even though you're smart enough to try to find a better way to find a parking spot, they won't. Which will result in the scenario you describe.

In reality, if you begin arriving earlier you place pressure on those that currently arrive just before you. They have about four basic choices: 1.) arrive earlier, 2.) arrive later, 3.) find new places to park (or work), or 4.) find new ways to come to work (carpool, etc). If they choose 3 or 4, there are more spots available to those who drive to work. Since they chose this option while you did not, their personal cost for these options are less than yours. If they choose 1 or 2, they place more pressure on the ends of the bell curve of work arrival times. Pressure closest to the 'early' end of the bell curve will most likely cause early people that continue to drive to arrive slightly earlier while pressure near the 'late' end will cause late people to arrive slightly later to pick up the spots the early birds leave. That's because the marginal difference is smaller to simply change your arrival time by 5 minutes than to rearrange your entire day. As the pressure ripples through the parking lot, the ends of the bell curve will stretch out as those that arrive first will arrive slightly earlier while those that arrive late will arrive slightly later. That stretching action will mean fewer people at one time in the parking lot. That means spots are easier to find.

So arrive earlier.

Here in the ghetto we have a

Here in the ghetto we have a simple solution. Pick a spot. Declare it "yours". Threaten violence/vandalism against those who park in "your" spot. (This is not my chosen strategy, but one i have run into often.)
Alternatives:
Encourage your coworkers to jitney, carpool, bike, segway, work at night.
Install parking meter at "your" spot, or "reserved for Dr. Friedman" sign or "reserved for sergi or patri". Deflateable fireplug? Orange cones?
Currently you are getting about 8 mph in your commute. That leaves room for some sort of efficency enhancement.

How about taking a cab to

How about taking a cab to work? It would save you the time wasted looking for parking & would free up one parking space. Just throwing it out there.

RKN - your argument is not

RKN - your argument is not appropriate to our particular lots. Our parking lots are spread out, and cover a lot of area around a lot of different buildings. Hence the difficulty of finding a spot, and the amount of time to walk to the office from there, increases monotonically with how full the parking lot is.

But your previous comment only said that what monotonically *decreases* as the lot fills is the next commuter's "ability to find a spot." That's what I was nitpicking. I still don't understand this premise; how is commuter #3's "ability to find a spot" reduced simply because she has only 198 parking places to choose from, instead of all of them (200)?

Then here you're adding that there's a monotonic *increase* in walk time as the lot fills. I'm not familiar with the geometry of all your parking spaces relative to each commuter's office, but I doubt that no equivalencies exist between those pair wise distances. Or even that reducing walking time is the sole metric that predicts how the lot fills up. It's not at all unusual for early arrivers in Porsches, for instance, to deliberately park at the far end of a lot to reduce their exposure to accident. Or, people will pass over a spot which would reduce their walk time, favoring another because it gets afternoon shade. Or or or... there are many reasons why we wouldn't necessarily expect lots to fill monotonically to reduce walk time.

Plus, if what you say is really true, i.e. *time* is the economic expense one wants to reduce, then the solution is simple for late arrivers, walk faster!

This Week's Carnival of The

This Week's Carnival of The Capitalists
This week's COTC is up and running over at Casey Software. Lot of interesting booths to stop by. Here are my favorites:

This Week's Carnival of The

This Week's Carnival of The Capitalists
This week's COTC is up and running over at Casey Software. Lot of interesting booths to stop by. Here are my favorites: