Donald Shoup

Based on Wikipedia: Donald Shoup

The Man Who Made You Think Twice About Free Parking

Here's a paradox that most people never consider: the free parking space in front of your favorite restaurant might be one of the most expensive things in your city. Not expensive for you, perhaps, but devastatingly costly for everyone else. One economist spent his entire career proving this point, and in doing so, transformed how cities around the world think about those painted rectangles of asphalt we take for granted.

Donald Shoup died in February 2025 at the age of eighty-six. If you've ever wondered why parking meters in some cities now adjust their prices based on demand, or why some employers offer you cash instead of a free parking spot, or why certain neighborhoods have eliminated requirements that every new building include a certain number of parking spaces, the answer often traces back to this professor from the University of California, Los Angeles.

His influence was so significant that the American Planning Association, the organization representing urban planners across the United States, gave him their National Planning Excellence Award for a Planning Pioneer in 2015. But his ideas took decades to gain acceptance, and they still provoke heated arguments in city council meetings and neighborhood association gatherings across the country.

The Education of a Parking Revolutionary

Shoup was born in Long Beach, California, in 1938. When he was just two years old, his family relocated to Honolulu because his father worked for the United States Navy. This early exposure to two very different American cities, one sprawling across Southern California's flatlands and the other squeezed onto Pacific islands, may have planted seeds of curiosity about how places are organized.

He ended up at Yale College in the late 1950s, arriving in New Haven, Connecticut, at a fascinating moment in that city's history. The mayor at the time, Richard C. Lee, had embarked on an ambitious urban renewal program. New Haven was building massive parking garages and constructing the Oak Street Connector, a highway project designed to improve traffic flow through the city. The young Shoup witnessed firsthand what happens when a city tries to accommodate cars through big infrastructure projects.

At Yale, Shoup earned not one but two undergraduate degrees, in electrical engineering and economics. He then stayed for his doctorate in economics, completing it in 1968. The combination of engineering and economics would prove crucial to his later work. Engineers think about systems and efficiency. Economists think about incentives and trade-offs. Parking, it turns out, involves both.

The Thesis That Changed Everything

After finishing his doctorate, Shoup headed back to California, taking a position as a research economist at the University of California, Los Angeles's Institute for Government and Public Affairs. He spent four years at the University of Michigan before returning to UCLA in 1974 as an associate professor of urban planning. By 1980, he had earned a full professorship.

Initially, Shoup focused on public finance and something called land value tax theory. This connects to an intellectual tradition going back to the nineteenth-century economist Henry George, who argued that the value of land, as opposed to buildings or other improvements, should be the primary basis for taxation. Followers of George's ideas are called Georgists, and this framework would later prove central to Shoup's thinking about parking.

Then, in 1975, something shifted his focus dramatically.

A graduate student completed a master's thesis containing a striking finding. Employees of Los Angeles County were almost twice as likely to drive alone to work compared to federal employees in the Los Angeles Civic Center. The crucial difference? County employees had access to free parking. Federal employees did not.

This might seem obvious in retrospect. Of course people drive more when parking is free. But the magnitude of the difference was stunning. And it raised a question that would occupy Shoup for the next fifty years: if free parking changes behavior this dramatically, what other effects might it have that we're not seeing?

The Hidden Cost of "Free"

Parking is never actually free. Someone always pays for it. When a shopping mall offers free parking, the cost is built into the prices of goods sold in the stores. When an apartment building includes "free" parking for residents, the cost is built into the rent, meaning people without cars subsidize those who have them. When a city requires that every new restaurant include a minimum number of parking spaces, the cost gets built into menu prices and, often, means fewer restaurants can afford to open in the first place.

Shoup's 2005 book, titled simply The High Cost of Free Parking, laid out these hidden costs in exhaustive detail. The book runs to over seven hundred pages in its revised edition. It became something of a cult classic among urban planners, transportation engineers, and a certain type of urbanist who gets excited about municipal zoning codes.

The book draws heavily on Georgist economic thinking. Henry George believed that land values are created by the community, not by individual landowners, and therefore the community should capture that value through taxation. Shoup applied similar logic to parking. The curb space in front of a popular restaurant has value because the community built the streets, the businesses, the transit connections that make that location desirable. Why should that value be given away for free to whoever happens to park there first?

The Magic Number: Eighty-Five Percent

Shoup became famous for advocating a specific target: parking occupancy should be around eighty-five percent.

This number might seem arbitrary, but there's elegant logic behind it. When a block has fewer than eighty-five percent of its parking spaces occupied, there are always a few spots available. Drivers can arrive, find a space relatively quickly, and get on with their business. The parking system is working smoothly.

When occupancy rises above eighty-five percent, something changes. Drivers arrive to find no obvious open spaces. They have to circle the block, searching. Maybe they circle twice, or three times, or more. This behavior, which Shoup memorably termed "cruising for parking," seems minor on an individual level. So you spent an extra three minutes looking for parking. What's the big deal?

The big deal emerges when you multiply that extra driving across everyone who's searching. In a dense commercial district during peak hours, a significant percentage of all traffic might consist of cars cruising for parking. Studies in various cities have found that cruising can account for thirty percent or more of traffic in congested areas. All those circling cars create congestion that slows down everyone else, including buses, delivery trucks, and people who have already found parking and just want to drive home.

Beyond congestion, there's fuel consumption. All those extra miles driven while searching for parking burn gasoline, costing drivers money and producing emissions that everyone breathes. The environmental impact of cruising is genuinely significant when aggregated across an entire city.

Shoup's solution was elegantly simple: raise the price of parking until occupancy drops to around eighty-five percent. At that level, there are always a few spaces available on every block. Cruising disappears. Traffic flows better. Air quality improves.

From Theory to Policy

Academics often write papers that sit unread on library shelves. Shoup's work had real-world impact.

His research on employer-paid parking led directly to California's parking cash-out law. This legislation requires certain employers who provide free parking to also offer employees the option of taking cash instead. If your employer would spend a hundred and fifty dollars a month on your parking space, you can choose to take that money and find another way to get to work. The law recognizes that giving employees "free" parking isn't really free; it's compensation that only car commuters receive.

The parking cash-out concept also influenced federal tax law. Changes to the Internal Revenue Code began treating employer-paid parking differently, encouraging companies to offer cash alternatives rather than just parking subsidies.

But perhaps Shoup's most visible legacy is the spread of demand-responsive parking pricing. San Francisco pioneered this approach with its SFpark program, launched in 2011. Parking meters in parts of the city now adjust their prices based on occupancy data. When spaces on a block are mostly full, the price rises. When many spaces sit empty, the price drops. The goal is always to maintain that roughly eighty-five percent occupancy rate.

Dozens of cities across the United States and around the world have since adopted similar approaches. Los Angeles, naturally, was among them; Shoup consulted extensively with his home city.

Eliminating Minimums

Beyond pricing, Shoup inspired a movement to eliminate parking minimums altogether. Most American cities have long required that new buildings include a certain number of parking spaces. A new apartment building might need one or two spaces per unit. A new restaurant might need one space for every few seats. These requirements add enormously to construction costs and consume vast amounts of land.

Shoup argued that these minimums make no sense. The market can determine how much parking people actually need. If a developer builds an apartment building without much parking, they'll have to price the units accordingly, and people who really need parking will choose to live elsewhere. The minimum requirements essentially force developers to provide parking whether anyone wants it or not, driving up housing costs and spreading cities across more land than necessary.

This argument has gained remarkable traction. Numerous cities have reduced or eliminated their parking minimums in recent years, from major metros to smaller towns. California passed statewide legislation in 2022 eliminating parking minimums near transit stations. The idea that every new building needs a government-mandated quota of parking spaces, once unchallenged conventional wisdom, is now hotly contested.

The Georgist Connection

To fully understand Shoup's thinking, it helps to grasp the Georgist framework that underlies it. Henry George was a nineteenth-century economist and journalist whose 1879 book Progress and Poverty became one of the best-selling American books of its era. George observed a puzzle: as societies became wealthier overall, poverty seemed to persist or even worsen in many places. He blamed this on land speculation and the private capture of land values.

George's solution was a "single tax" on land values. Since the value of land comes from the surrounding community rather than from anything the landowner did, George argued that taxing this value is both economically efficient and morally justified. Unlike taxes on labor or investment, which discourage productive activity, a tax on land values captures wealth that would otherwise flow to whoever happened to own a particular piece of ground.

Shoup saw parking through this lens. The curb space in front of a popular destination has value precisely because of its location, value created by the community. When the city gives that space away for free parking, it's transferring community-created wealth to whoever happens to occupy the space. When the city charges market-rate prices for that space, it recaptures that value for public benefit.

In a 2004 paper titled "The Ideal Source of Local Public Revenue," Shoup explicitly connected parking revenue to Georgist principles. The revenue from properly priced street parking, he argued, represents one of the purest examples of George's ideal: a tax that captures community-created value without discouraging productive activity.

Return the Revenue to the Neighborhood

One of Shoup's most politically astute recommendations was that parking meter revenue should be spent in the neighborhoods where it's collected. This addresses a common objection to higher parking prices: why should drivers pay more just so the money can disappear into the city's general fund?

Shoup proposed creating parking benefit districts. The revenue from meters in a given area would fund improvements in that same area: better sidewalks, cleaner streets, more trees, improved lighting. Merchants who might otherwise oppose higher parking prices often become supporters when they see the revenue paying for improvements right outside their doors.

This approach has been adopted in various forms by cities including Pasadena, California, which pioneered the concept and saw significant investment in its Old Pasadena district funded by parking revenue. The district's success became a model that Shoup frequently cited in his advocacy.

Criticism and Controversy

Shoup's ideas have never been without critics. Some argue that higher parking prices hurt low-income drivers who have no alternative to driving. Shoup responded that free parking actually hurts the poor more: it's a subsidy captured primarily by car owners, and its costs get passed along to everyone through higher prices for goods and services and through the sprawling land use patterns that make driving necessary in the first place.

Others argue that eliminating parking minimums will lead to chaos, with new developments providing no parking and their residents flooding surrounding streets. Shoup countered that proper pricing of street parking solves this problem: if curb spaces are priced correctly, there will always be availability, and developers will provide whatever off-street parking the market demands.

Some urbanists, ironically, criticize Shoup from the other direction, arguing that his focus on parking pricing accepts the automobile-dominated status quo rather than challenging it. They would prefer to see cities invest in transit and bike infrastructure that genuinely reduces the need for driving, rather than simply managing car use more efficiently.

A Life's Work

Shoup didn't just write about parking policy; he engaged directly with the cities trying to implement it. He consulted with municipalities across the country and around the world, providing expert testimony, reviewing proposed policies, and nudging officials toward evidence-based approaches.

He served as Director of the Institute of Transportation Studies at UCLA and as Chair of the Department of Urban Planning. He was a visiting scholar at the University of Hawaii, Cambridge University, and the World Bank. He sat on the advisory board of the Parking Reform Network, an organization that exists largely because of the movement his work inspired.

Throughout his career, he maintained a productive research output, publishing papers on topics ranging from optimal land development timing to employer parking subsidies to the practice of "in lieu" fees, where developers can pay a fee instead of building required parking.

In early 2025, a festschrift was published in his honor: a collection of essays titled The Shoup Doctrine, celebrating his work and extending it in new directions. Such volumes are typically published while the honoree is still alive to appreciate them, and Shoup did live to see this tribute to his influence.

He died at home in Los Angeles on February 6, 2025, from a stroke. He was survived by his wife, Pat.

The Parking Professor's Legacy

It's rare for an academic to see their ideas transform actual policy during their lifetime. Most scholars are lucky if their work influences a few graduate students and generates a handful of citations. Shoup's ideas reshaped how hundreds of cities manage millions of parking spaces.

Drive through a city with demand-responsive parking meters, and you're experiencing Shoup's influence. Walk past a new apartment building in a city that has eliminated parking minimums, and Shoup's arguments made that building possible. Receive an offer of cash in lieu of a free parking space from your employer, and thank the research Shoup conducted decades ago.

The broader impact may be harder to measure but equally significant. Shoup helped establish the idea that parking is a policy question deserving serious analysis, not just an engineering problem to be solved by building more spaces. He demonstrated that something as mundane as parking involves economic incentives, land use patterns, environmental effects, and equity considerations. He showed that good policy can make cities work better for everyone, not just for those who happen to show up first.

Not everyone agrees with his conclusions. The debates he sparked continue in planning offices and city councils and neighborhood meetings across the country. But the fact that we're having those debates at all, rather than simply assuming that more free parking is always better, is itself a testament to one economist's fifty-year crusade to make us think differently about those painted rectangles of asphalt.