Due to China’s extremely rapid urbanization, the transition to an automobile‑dependent society has also progressed at a breakneck pace. Such dramatic social changes can rightly be described as “changing with each passing day.” Twenty years ago, owning a private car might have been just a distant dream, but today, many people can afford one with just a few months’ wages.
Once a luxury item, automobiles have now become commonplace—“the swallows that once nested in the halls of noble families have flown into the homes of ordinary people.” In the days when cars were still relatively scarce, parking was hardly an issue, and free parking was taken for granted. Back then, charging for parking would not only have been unreasonable but also economically impractical; the fees collected might barely have covered the costs of the staff administering them. Today, with far more cars than available parking spaces, whether to charge—and if so, how—has become a pressing social issue; otherwise, it could give rise to significant societal risks.
Why charge a fee? First and foremost, it’s a matter of fairness among property owners.
There are disputes and misunderstandings regarding the property rights of parking spaces in residential communities (click to view details). Even if some parking spaces are owned by all the homeowners, that does not necessarily mean they should be free. After all, when a space is jointly owned by all residents, it raises issues of fairness among them. If common areas are shared by all owners, then parking spaces should be as well—so why should you be allowed to park in my designated spot at no charge? I have control over my share of the common areas, and just because I don’t own a car doesn’t mean you can arbitrarily appropriate my rights. The fair approach is: market-based pricing and revenue sharing for parking fees.
In other words, parking fees should still be charged to property owners, and the revenue from these fees, after deducting basic operating expenses, should be allocated to all owners. If such funds are distributed, they ought to be shared according to each owner’s share of common-area expenses or used to offset property management fees. Notably, a residential community in Wuhan has been following this very approach for many years.
Why charge a fee? Secondly, it’s a matter of social efficiency.
Free or low‑cost parking in residential communities raises another issue: social efficiency. Under conditions of free or subsidized parking, even when parking spaces are in short supply, private capital is reluctant to invest in building additional parking facilities, leaving the parking shortage unresolved over the long term. Because free or low‑cost spots remain available, privately funded parking projects fail to attract users, and residents prefer to park haphazardly rather than use the newly built garages. If parking fees were market‑based—while owners share the revenues according to their respective common‑area shares—private investors would be more inclined to fund parking infrastructure, enabling new parking facilities to fulfill their intended purpose and help alleviate the parking crunch.
Parking space utilization is low, and this manifests in two main ways. First, some parking lots have a significant number of empty spaces—this is the more readily apparent form of underutilization. Second, in neighborhoods where parking is severely constrained, many vehicles remain parked for extended periods, effectively becoming “zombie cars.” This type of underuse is often overlooked. In areas where parking is already scarce, it’s essential to boost vehicle turnover. As for those long‑parked “zombie cars,” they should be moved to parking facilities with greater availability. The reason such relocation hasn’t occurred is primarily because, even as these neighborhoods grapple with parking shortages, they often offer free or very low‑cost parking. Consequently, these vehicles neither move—lacking any financial incentive—nor seek alternative spots—finding it more convenient to stay nearby—or can move at all—since their locations are unstable and once they’re relocated, they may never return.
Why charge a fee? This is still a public safety issue.
Today, the challenges of finding and managing parking—both in terms of scarcity and disorder—are not confined to first-tier cities; they are common issues in second-tier cities and even in third- and fourth-tier urban centers. The resulting chaos caused by inadequate parking not only undermines residents’ quality of life but also degrades the living environment within residential communities, posing significant safety risks. In many residential communities, fire lanes are little more than a formality; should a fire break out, the consequences could be disastrous. We must never wait until a painful lesson has been learned to take corrective measures. A responsible city administrator should plan ahead and prevent problems before they arise. By implementing a fee‑based parking system, we can increase the supply of parking spaces, curb parking demand, free up fire lanes, and safeguard public safety.
Some friends might argue that even parking should be free—charging for it is unfair, and parking spaces ought to be a “public good” provided by the government at no cost. Others may contend that, as operators in the parking industry, you’re naturally advocating fees; isn’t this just about chasing profits?
We’ll discuss these issues one by one—your own judgment will come later!
◆The parking space is “ “Private goods” or “quasi-public goods,” but not “public goods.”
Some people believe that parking spaces are “public goods” and should therefore be offered at low prices or even free of charge. In fact, this is not the case.
According to economic theory ， Social product It can be divided into private goods, Public goods and Quasi-public good Three categories. Private goods It refers to goods that exhibit divisibility in terms of utility, rivalry in consumption, and excludability in benefiting. Public goods, on the other hand, are characterized by non-rivalry in consumption or use and excludability in benefiting. Non-exclusivity products. Between public goods and private goods, there exist many products and services that do not possess the pure characteristics of either a public good or a private good, yet to some extent exhibit features of both; these are commonly referred to as Quasi-public good 。
Melodies, knowledge, plots, television signals, and national defense are all things that one person can enjoy without diminishing others’ ability to enjoy them; thus, they qualify as typical public goods. Eggs, bread, desk lamps, ties, and cars, on the other hand, are such that when one person uses them, others can no longer use them; hence, they are typical private goods. As for theaters, education, parks, and parking spaces, once the number of users reaches a certain threshold, one person’s use begins to affect others’ access; therefore, these are either private goods or quasi‑public goods.
The characteristics of public and private goods are inherent to the goods themselves; they do not depend on who provides them, how people label them, or whether fees are charged for their use. For example, a melody composed by Mozart is a public good solely because its consumption is non‑rivalrous, regardless of whether Mozart’s income came from the government, royalty, or private patrons; regardless of whether people regard such music as a necessity of life; and regardless of whether Mozart himself or subsequent performers sought royalties for the work.
Thus, parking spaces in desolate deserts are public goods, whereas those in urban areas are private goods or quasi‑public goods. Many people mistakenly believe that, by appealing to reason and framing parking as a public good, it can be provided at low cost or even free of charge, with no one having to bear the associated costs. This notion is entirely wishful thinking.
Regardless of how people choose to describe it, since one person’s occupation of a parking space precludes others from occupying it at the same time, the parking space qualifies as a private good and thus necessarily conforms to the economic principles that govern all private goods.
◆ Parking fees are not intended to generate revenue, but rather to maintain order.
In fact, as long as a good is private, rivalry over its use may arise; and once such rivalry emerges, society must adopt one set of competitive rules or another to determine winners and losers, thereby granting usage rights to some while compelling others to seek alternative solutions. This is what economics terms scarcity—a constraint that both human societies and the animal world must confront. People cannot alter the constraint of scarcity itself; they can only modify the rules of competition to ensure that different individuals prevail.
Methods Used by Residents of a Free-Parking Residential Community in Beijing to Occupy Parking Spaces
Historically, people have employed a wide array of competitive rules—ranging from violence and cunning to official rank, birth, gender, age, and patience. Economic theory shows that all these mechanisms steer individuals toward contests that favor their own success at the expense of others, thereby generating inefficiencies—such as excessively developed muscles, unnecessary exam‑taking skills, the costs of flattery and backstabbing, and the time wasted waiting in line. And… Weifang Massacre (click to view details) This is the outcome of a brutal, lose-lose competition.
By contrast, only a “user‑pays, highest bidder wins” rule can incentivize individuals to deliver valuable goods or services to society and use the profits they earn to compete under the same principle. When the majority of society’s resources are allocated according to this rule, the overall cost of competition declines, while returns rise. In general, “user‑pays, highest bidder wins” is the most economically efficient competitive framework.
Parking fees are not intended to generate profit; rather, they aim to uphold social order through the most economically efficient competitive mechanisms.
Moreover, parking fees are not entirely retained by the parking management company; rather, the majority accrues to the property owner—public property is allocated to the treasury, while privately owned property is assigned to its investors. The parking or property management company receives only a share sufficient to cover administrative costs. With advances in technology and innovations in management, the proportion of administrative costs in overall parking revenue continues to decline.
The same principle applies to on‑street parking fees. In certain urban areas, based on local conditions, the government designates a portion of on‑street parking spaces, which, like the earlier example, exhibit the “one person’s use precludes another’s” characteristic and thus qualify as private goods or quasi‑public goods. Consequently, when supply falls far short of demand—regardless of whether the property rights lie with the government rather than private owners—demand should be managed through pricing to mitigate the congestion caused by free parking. The additional revenue generated by such measures ought, of course, to be subject to appropriate oversight, just as with other sources of government income. However, to forgo the price‑based mechanism for moderating parking demand and easing traffic congestion simply out of concern that increased revenues might not be properly regulated would be akin to throwing the baby out with the bathwater.
