Car Ownership and Residential Parking Subsidies: Evidence from Amsterdam

Tinbergen Institute Discussion Paper 15-116/VIII

32 Pages Posted: 1 Oct 2015

See all articles by Jesper de Groote

Jesper de Groote

Vrije Universiteit Amsterdam, School of Business and Economics

Jos N. van Ommeren

Vrije Universiteit Amsterdam, School of Business and Economics; Tinbergen Institute - Tinbergen Institute Amsterdam (TIA)

Hans Koster

VU University Amsterdam - Department of Spatial Economics

Date Written: September 25, 2015

Abstract

Many cities around the world have introduced paid parking but implicitly subsidize parking for example by providing residential parking permits for street parking. We study the welfare effects of residential parking subsidies through changes in car ownership for Amsterdam. We employ a boundary-discontinuity design that exploits spatial variation in the length of waiting lists for permits and therefore in the size of the parking subsidy. In the city center, the waiting time for a permit is up to four years. Our results indicate that one additional year of waiting for a parking permit reduces car ownership with 2 percentage points corresponding to a price elasticity of car demand of -0.8. We demonstrate that subsidizing residential parking induces a substantial welfare loss. On average, a parking permit induces an annual deadweight loss of € 270. Furthermore, we show that the provision of parking permits is an income-regressive policy: rich households are five times more likely than poor households to receive these (implicit) parking subsidies.

Keywords: parking policy, car ownership, household location choice

JEL Classification: R20, R40, R42

Suggested Citation

de Groote, Jesper and van Ommeren, Jos N. and Koster, Hans, Car Ownership and Residential Parking Subsidies: Evidence from Amsterdam (September 25, 2015). Tinbergen Institute Discussion Paper 15-116/VIII. Available at SSRN: https://ssrn.com/abstract=2656984 or http://dx.doi.org/10.2139/ssrn.2656984

Jesper De Groote (Contact Author)

Vrije Universiteit Amsterdam, School of Business and Economics ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands

Jos N. Van Ommeren

Vrije Universiteit Amsterdam, School of Business and Economics ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands

Tinbergen Institute - Tinbergen Institute Amsterdam (TIA) ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

Hans Koster

VU University Amsterdam - Department of Spatial Economics ( email )

De Boelelaan 1105
1081HV Amsterdam
Netherlands

Register to save articles to
your library

Register

Paper statistics

Downloads
54
Abstract Views
828
rank
370,771
PlumX Metrics