Friday, March 18, 2011

Why can't I pay more?

A few days ago I had the pleasure of visiting the DMV. It wasn't the worst experience I have ever had, but unpleasant nonetheless. What is amazing to me, is that there is ALWAYS a line. I mean, by sheer chance, one would think that there are times of the day where business is slow and you could get right in. Not a chance.

My purpose at the DMV was to get a new Washington State drivers license. It cost me not only 2 hours in line, but $64 to boot. It's really not about the money, but about my time. Truth is, I have better things to do than sit at the DMV. I could watch TV, enjoy a nice relaxing walk, or even work a little bit. I value my free time a lot, and I would be willing to fork over a few more dollars to have more of it.

But I can't pay more at the DMV for another person behind the counter. The reality is that the number of people behind the counter is very loosely correlated to the number of people in line. So, when lines build up, you wait. You wait as long as it takes, or until the next election.

In another system known as the free market, when demand goes up, prices go up, which encourages more supply and less demand. In laymans terms, you wait less.


Joseph said...

This would only work if there were two or more businesses that could compete for services the DMV provides. Since it is a state service only, there can be no competition.

Adam Freund said...

Why couldn't the government hire 2 or more providers for the service they require. Nothing requires the government to run the DMV. Additionally, even if the government did run the DMV, why can't they institute variable pricing (e.g. one line costs more but you get faster service).

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