The unbearable lightness of free parking (Bedava park etmenin dayanılmaz hafifliği)

Individuals think about parking spaces only when they are looking for one. Nevertheless, after money and credit cards, parking is one of the most important intermediate goods in a modern economy. Most economic transactions in the city start with individuals’ transportation to the point of transaction and their parking if they came to the point of transaction with their own car. As an intermediate good, parking consumes vast amount of land, which is one of the scarce natural resources in an economy, and often times it is underpriced or even free. For instance, a conservative back-of-the-envelope calculation yields that land allocated to parking in Istanbul is in the order of the total land area of Besiktas, Beyoglu, Fatih, Kadikoy, and Sisli. Providing such large and expensive pieces of land for parking with essentially no price obviously results in significant welfare loss for the society. This short paper aims to create awareness on the issue by exploring the causes and effects of free parking followed by a discussion of how to price parking spaces.