The Spatiotemporal Pricing of Some Urban Public Services: Urban Ecology, Equity, and Efficiency

Abstract

The paper discusses pricing schemes for some public services in urban areas with regard to equity and efficiency, taking into consideration the residential geography of cities, in terms of the spatial pattern of population density and the level of income. Spatial pricing schemes that use a distance criterion, especially distance from city center, are shown to be inadequate for purposes of equity and efficiency—the reason being the weakness of distance as an underlying variable in urban social ecology. One should, therefore, resort to a pricing scheme which comes as close as possible to the actual residential pattern. This paper suggests the use of a zonal and parcel pricing scheme which takes into account data on density and income by zone, or neighborhood, and by parcel. Usually such zonal and parcel data are quite readily available and are often used for such purposes as land use regulation or property taxation. With little additional effort a more refined spatial pricing scheme would be reached, thus equity and efficiency considerations would be more properly satisfied. By introducing additional data on the spatial distribution of peak and offpeak users, such a spatial scheme could replace temporal pricing in urban areas where peak-load pricing through metering is not feasible.