Friday, February 27, 2009

Marginal Cost

I think it is true that people often don't properly perceive the marginal cost of driving and related (parking). Making parking costs explicit and having pay-at-the-pump pay as you go insurance would help do this without increasing the actual cost in any way, and of course increasing costs so that drivers would internalize certain external costs would as well.

That still leaves vehicle depreciation which I don't think people really factor in either.