Spatial Competition Between Parking Garages and Downtown Parking Policy


R Arnott

Document Type

Journal Article

Publication Date


Subject Area

operations - capacity, planning - standards, policy - parking, organisation - competition, place - urban, place - cbd


Urban areas, Transportation economics, Transport economics, Static equilibrium, Standards, Regulatory policy, Policy, Policies, Parking capacity, Parking, Government policy, Equilibrium (Mechanics), Efficiency, Economics


This paper looks at optimal parking policy in dense urban districts ("downtown"), where spatial competition between parking garages is a key feature, from the perspective of economic theory. The paper has four parts. The first looks at the "parking garage operator's problem". The second derives equilibrium in the parking garage market when there is no on-street parking, compares the equilibrium to the social optimum, and examines optimal parking policy in this context. Since parking garage operators have market power, the spatial competition equilibrium is generally inefficient, and parking policy can be used to mitigate the distortion. The third adds on-street parking and considers how its underpricing affects second-best parking policy. The fourth adds mass transit, and considers how economies of scale in mass transit interact with minimum and maximum off-street parking standards.(A) "Reprinted with permission from Elsevier".


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