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The Right Price for Parking

The City of Austin sells valet parking companies the right to use a parking space for $250 per year. Is that the right price? I doubt it.? The appropriate price would be the?opportunity cost – which is at least the revenue raised if the slot were open to the public and metered. It may be much more than that. The only sensible way to determine the appropriate price would be by some kind of auction, including allowing private citizens to bid.? Their bids, plus the competition among valet parking companies and the restaurants that contract with them would help the price reflect the value of the space more closely. As it is, the average driver/parker is probably subsidizing restaurant customers who use valet parking, the restaurants themselves and the valet parking companies.? A classic problem – the same one that used to describe spectrum giveaways before we started auctioning frequencies. (HT: CW)