Another frightening article on market pricing

This article is on the front page of Today paper called ‘Missed opportunity in parking policy’. It was written by a smart professor, a foreign talent of course, called Paul Barker. Actually it does not need a professor to think of market pricing for car parks. I can do better, not bluffing, if my intention is to rob the motorists. The gist of the article is that car parks should be priced according to demand and supply, using market mechanism. I couldn’t help laughing. Applying it will just go the HDB way, the ERP way, the COE way. When supply exceeds demand it will only mean one thing, UP! Imagine what parking fees will be in the CBD if parking is charged according to market mechanism? Bee tang to the operators! Our physical constraints make market mechanism impractical. It is suicidal to go that way. Market mechanism cannot be blindly applied to housing, cars, car parks, medical services, and many other things here!


Wally Buffet said...

The sub headline for this articles is "Researcher says market-based pricing better, others believe implementation will be tricky."

"Tricky?". I'll be more straightforward and say it's a downright idiotic suggestion. Comparing Singapore with other Asean cities where presumably market driven rates are implemented is moronic as you rightly pointed out that the supply is constrained while the demand is definitely not.

One commentator on the article even postured that this is the way to go so that only those who can afford to own private cars really do so. Well, let me tell this person that taking away a Sinkapoorean's other prized possession next to his HDB is like taking away an arm or a leg and don't be surprised if they'll just go berserk!

I honestly believe that this will not be implemented as despite their faults, they know that such a "study" is only for academic gossip and not fit to put into practice as the political risks far outweigh the monetary benefits.

An increase in HDB and URA parking charges hopefully not "life threatening" may be imminent though because this Prof's study and its reporting is just a harbinger of the "kena whacked" kind of feeling to come.


Anonymous said...

Rest assured that the article is meant to 'test' the ground and a preamble to it's implementation.
Before the casinos were approved by the Authority, a female SPH Journalist had a write-up that sang heavenly about advantages of having casinos.
Inspired by her article, I wrote to the Straits Times and Minister Vivien Balakrishnan and received a printed standard reply which many others petitioning against casino, also received from his ministry.
I raised specific reasons and posed pertinent questions but they were not answered.
Indeed soon after that write-up, the casinos were approved by the Cabinet.
Now, they are up and running AND ruining the live of many and their families.
Actually market pricing have been implemented at ERPs and Carparks, it is just that they may like to justify for raising them with a write-up by a professor.
The Blame should goes to the STOOPID SINGAPOREANS who without fail, always believed in educated rascals and so-called professionals many are conmen in disguises.

Chua Chin Leng aka redbean said...

Agree, like they said, the writings on the wall.

Rich Singaporeans would not complain if the increase is incremental. Not so rich Singaporeans also don't mind paying more and more.

Anonymous said...

Singaporeans must make their votes count.

Matilah_Singapura said...

Market based pricing is not "better" simply from a philosophical/ ideological point of view, or as a conspiracy to "screw" people out of more of their money.

Market based pricing simply objectifies the asset/ resource values by putting a "price" on them -- a sort of "relative strength" which signals how "scarce" the resource is.

If you don't use market-based pricing, you get distortions in the capital structure leading to (usually) shortages and dislocations somewhere along the way.

Owning/ driving a car is not an automatic "right". It is a privilege which must be EARNED by being productive enough so that you get paid enough for what you do to be able to afford a car.

To those who criticize market pricing, the obvious question is: what is the alternative?

Fix the price by govt edict? How would you that is the "right" price? You can't. Market price mechanisms are just SIGNALS.

No one likes to "have to" pay for stuff. Especially as a car owner in Singapore -- you are taxed every time you move...or even if you are stationary. But the fact remains: car ownership is not a "right". It is a voluntary choice.

Wally Buffet said...

You've got a point there.

For starters, all Off Peak cars should be taken off the roads. People who can't afford a normally registered car should not really drive at all.

What's all these bull about owning a car and then you can only drive between certain hours and only on weekends. Such cars merely add to the demand side of the price equation for coe and congestion on the roads especially when one is in a rush to get to the pleasure spots in the evenings.

But the current high coe prices is a good thing because these fockers who want to register an off peak car is really screwed. Paying heftily for a machine you can only use at a designated time and day.

Just like having a mistress you can only screw when the clock passes seven pm in the evenings.


Anonymous said...

By and by we will have COE for car parks, COE for certain roads, COE for entering the central business districts etc.

Agitate all you want folks, the writing is on the wall. The time will come.

This article is just to garner the reaction of Singaporeans, idiotice it may be. That is their way of getting feedback.

Matilah_Singapura said...

COE is bullshit. It is not car OWNERSHIP which poses the main problem. If you own a car and keep it parked -- that poses no problem. You simply pay for the space, and go admire your "artifact" whenever you feel like being inspired.

Parking space is not a scarce resource (although there is scarcity per se i.e. it is not "infinite")

The main problem is congestion on the roads -- everyone seems to want to travel at similar times -- i.e. during the day, when most human mobility happens.

Road space, IS the scarce resource and it varies according to time of day.

Therefore the COE should go, and the ERP increased (where necessary) and applied more or less island wide.

To be fair, no congestion, no charge. With live traffic density monitoring you can introduce a "floating price system" -- more congestion, pay more.

This system is fair: you use the roads -- you pay. You use at peak periods -- you pay more. You have a choice: don't use the roads during peak periods -- use public transport.

You can still own a car, and reasonably cheaply too. At least you can get away and drive to Malaysia...even Thailand on the weekend -- an option not available to many because of the UNFAIR, UNJUST and irrational COE

Chua Chin Leng aka redbean said...

Let me pauper talk big like a big man for once. Agree with Wally, all those who can't afford to drive should not be driving and pushing up the COE prices.

Let's start with the OPC. Ban the OPC. The roads are only for the rich and talented.

Let me peep to see how many more months before my OPC car expires. Then I will just park it in the car park. Don't buy COE, don't renew road tax, no insurance. Just pay parking to HDB. Then every weekend can go to car park and wash car, polish it kilat kilat, shine like army boots: )

Matilah_Singapura said...

PS If you remember in my previous posts, I have always favoured a higher ERP -- especially during peak periods.

I would like to see $50 ++ ERP in the CBD if traffic got to a point where something has got to give, or it will be congestion for hours.

The COE does nothing to solve congestion issues -- which is the main issue in a land-scarce, densely populated, affluent society

Wally Buffet said...

I'll second that since I don't go into the CBD during peak hours.

My window of opportunity is between 10 am to 12 noon when it's free entry.

Better still, increase it to $100 so those who drive their ya ya latest model show offs and pay like a duke as well.

Matilah_Singapura said...

And the benefits accrue to the lower net worth people too.

Get rid of the COE, your average Jo and uni student can afford a car. Say Hyundai Getz, let's take the Aust price as a guide: $13,000 drive away. Without COE, it would cost about the same -- say SGD18k.

Now those people have the freedom to drive in Malaysia, where it is far less congested. Freedom increased.

Wally Buffet said...

"Now those people have the freedom to drive in Malaysia, where it is far less congested."

Provided you don't get raped, mugged, robbed or beaten senseless and you come back alive to say how swell was the great empty spaces, the virgin jungles on your left and right and the rolling hills were just awe inspiring!


Matilah_Singapura said...

Ah, to be young and have a sense of adventure...

Actually if you look at the bikers -- many of them go up country. Bikes are more affordable than cars in S'pore.

So by the same reasoning (with the usual caveats) if cars were cheaper, and road use in S'pore priced appropriately, it's reasonable to assume that "cheaper" pricing of road use in Malaysia will attract more users from Singapore.

Another assumption: a huge portion of road use is for "leisure" purposes -- e.g. going to makan, socialising, shopping, movies. So, go to Malaysia for "leisure" driving.