Congestion Pricing Revisited

Economists have long advocated for congestion pricing to mitigate classic tragedy of the commons problems such as traffic congestion. Today in the Wall Street Journal, Carl Elliot’s review of Benjaim Ginsberg’s The Fall of the Faculty provides a great new example.  Deans everywhere will fear Ginsberg’s book.  I really liked the following quote;

“A bizarre cost-saving plan proposed by the chancellor of the Tennessee higher-education system would offer tuition discounts to students who agreed not to come to class or get instruction from professors—or as the chancellor put it, to “work online with no direct support from a faculty member.”       This is a funny example of congestion pricing.  

Switching Subjects — if you want to see a consistent thinker in action, read Gary Becker’s piece in today’s WSJ.   The University of Chicago remains #1! 

Author: Matthew E. Kahn

Professor of Economics at UCLA.

12 thoughts on “Congestion Pricing Revisited”

  1. #1 in what? B.s. pleasing to the plutocracy?

    Being consistent with your previous ideas in the face of devastating new facts is precisely what Emerson called the ” foolish consistency” that, he said, constitutes “the hobgoblin of small minds.”

    All Becker demonstrates is that a small mind is utterly consistent with a Nobel Prize.

  2. Becker notes that “strong backing from influential members of Congress … encourage[d] irresponsible mortgages that required little down payment.” He doesn’t note that many of those “influential members of Congress” were bought and paid for by the financial institutions that made (or bundled) the “irresponsible mortgages.” Among the “[r]egulators who could have reined in banks instead became cheerleaders for the banks” was Christopher Cox, who chaired the SEC under Bush. I’d like to hear a response to this tripe from Bill Black — are you there, Bill?

  3. I don’t understand what Becker felt he would accomplish with this opinion piece. He has simply repeated the same 4-5 talking points which have been so popular among conservatives for the past few years. What new information would a conservative reader gain from this column? I am a little shocked by how pedestrian an effort this is. He hasn’t written a single thing which Sean Hannity or Rush Limbaugh don’t say on a daily basis.

  4. Becker: “Highly publicized are the troubles facing Greece, Portugal, Ireland, Italy and Spain that are mainly due to the growth in spending and debt of their governments prior to the 2008 crisis.”
    The debt-to-GDP ratio of Spain was falling before 2008 and was down to 36% in 2007. Ireland’s was below 30% that year. It shot up after the crisis is because governments were forced into rescuing colossally reckless banks.

    I confirmed this very well-known picture in five minutes with Google. Becker is a liar, or incompetent, or has signed off on some Murdoch hack’s work. Kahneman should write a paper on “The élite Dunning-Krueger effect.”

  5. sven says:

    “I don’t understand what Becker felt he would accomplish with this opinion piece. He has simply repeated the same 4-5 talking points which have been so popular among conservatives for the past few years. What new information would a conservative reader gain from this column? I am a little shocked by how pedestrian an effort this is. He hasn’t written a single thing which Sean Hannity or Rush Limbaugh don’t say on a daily basis.”

    Becker is a *Chicagoist*. It’s clear by now that any time a Chicagoist makes a public statement, he/she/it should be presumed lying until proven otherwise (or unless you know that person’s particular record).

    We’re watching that entire school unravel, as reality moves increasingly far away from it (it’s clear now that some large chunk of their macro simply wasn’t true, but that there wasn’t enough evidence in the 80’s and 90’s to demonstrate that).

    Mark, have you had enough of Kahn now? I was amazed that you let this guy in as a poster, and just about every post makes me wonder more.

  6. Becker is absolutely right about government failure as a major contributor to the crisis. The political process, trying to please powerful interest groups, certainly suborned government function. Where Becker is dead wrong, however, is his identification of the constituency that the government was trying to please. The pleasured class was the bankers, not the Negroes.

  7. I’ve been quite open in my dislike of several of Kahn’s posts, but I’m a bit surprised how many people in this thread are taking his comment about Becker and Chicago seriously, as grounds for further criticism of Kahn’s ideology. I assumed Kahn’s link to Becker and its tagline (reminiscent of Charlie Sheen’s “Winning!”) was sarcastic, that the link was meant to highlight the fact that, despite everything that has happened and all the havoc they’ve managed to wreak, in their minds the Chicago School folks are still the holders of the Truth and the best economists in the world. Honestly, I couldn’t see how the link was meant to be anything other than sarcastic – how anybody other than the fools and knaves at the WSJ editorial page could have taken the Becker piece seriously.

  8. Warren, because (a) Kahn is from there, (b) he certainly has demonstrated total vacuity in his other posts here, and (c) Chicago guys aren’t kidding. They’ll repeat these lies until their in their grave, when their books and proteges will continue their lies.

  9. The American corporate model has contributed little to the improvement of consumer or trade relations in this layman’s opinion. Has anyone done studies on the comparative effectiveness, efficiency, and societal acceptance/rejection of corporate impacts vs any other successful business/institution models? Never mind, I should look it up.

    As business influences have increased in all our major institutions, I’ve wondered whether there is gained efficacy as a result. Does anyone measure such?

    I’ve seen top-heavy administration adopted without maintaining the positions’ authority to accomplish the stated educational nor business purpose. I then thought it might be a “business” decision in order to prevent unionization of staff as the work tasks themselves seemed not to change so much as the title of the position. Plus I think it might, over time, situate the institution to more easily become a private interest.

    In faculty positions it seems that instructors’ (even the professorial levels)time was hobbled and compromised for much of the paperwork previously assigned to clerical staff. This would downgrade the faculty position while eliminating jobs previously considered clerical only.

    With the advent of the Internet Age, it does seem silly to segregate the millions who WANT to learn and receive credit from those who can afford to attend college or university. Doesn’t the corporate model conflict with the mission to extend to, and perpetuate, an educated populace and society?

    I’d like to see the educators take the lead on needed transformation rather than be forced into a defensive position to protect that of which I’ve heard no admiration nor support as the best way to educate, enable educators to do their work, nor create progressive education. I come from an academic family with ties to 6 colleges and universities across the country. Dissatisfaction with the “system” was consistent as we met members of administration, faculty, staff, and students at each new school.

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