Fare Dodgers!

This one is pretty creative. A group of people in Paris are trying to institutionalize the age-old practice of fare dodging (once the exclusive preserve of students ...).

http://www.timesonline.co.uk/tol/news/world/europe/article7115236.ece

Under the guise of a very specious argument that public transport ought to be a pure public good (i.e. the state should provide this for free), they are promoting the idea of dodging fares on the Paris metro. They even have an 'insurance fund' in place as a risk pooling mechanism. I wonder if the ever-enterprising Mumbai local train commuters figured this model out ...

To begin with, public transport is clearly not a public good - given the simple fact that there is always a shortage of availability of good public transport in any city (and certainly a city of the size of Paris), there needs to exist a price mechanism to ensure that the demand is controlled to align with the supply. Which itself may sound paradoxical, given that one of the goals of public transport is to offer a low-cost alternative to people. So long as the cost of public transport is lower than any other means of private transport at the margin, it will always remain the more effective mode of transport. And once you add up all the other negative externalities that transportation creates (pollution, global warming, oil dependency et al), public transport wins hands down as a public utility.

Giving it away for free will create an administrative headache of managing the demand, which will almost certainly outstrip supply -hence the need for a price mechanism. And so, if there is a city where the supply of transport far exceeds the demand, there may be a case for the state to subsidize a large part (if not the complete) cost of public transport.