Tyler Cowen on Productivity

If there is a reasonable voice on the free market side of the economics debate these days it is Tyler Cowen. His insights and ideas are where the Keynesian counter-balance should be - unfortunately it is not. He has a good piece in the New York Times on the declines in American productivity and what it could mean to the economy. Evidence that Cowen is a good counter-balance? How about the quote, "Keynesians argue that the economy is suffering from a lack of spending or too little "aggregate demand". That is a valid point, but...." How often do you hear that in economic debate these days?

Hidden Cost of Parking

Most of my economics students are in the process of getting, or have just obtained, their drivers licence. This pass to freedom is among their most cherished rites of passage. For high school students it is a big event to drive to school, as opposed to riding the bus or getting a ride with somebody else.

Many students quickly realize that the freedom of driving is hardly free. There is the large costs of gas, insurance and repairs.

On a side note, it is often sad to see how much time students spend working to pay for their cars. They often spend too much time working jobs, and not enough on school or sports.

However, one cost they do not think about is parking. The school I teach at provides free parking to students. Tyler Cowen in the Economics View column in the New York Times explores the real cost of parking and how there are many market distortions in parking. He notes how these distortions work as a subsidy meaning that the reality of free parking causes people to drive too much. It is a great little piece and I will be using it with my students this fall. It will be interesting to hear how they respond to something that cuts so close to their new found freedom.