"First of all, America is not the land of the price gouge. Lots of things gas, gadgets, groceries, blue jeans are cheaper here than in other developed countries. Second, the $6 fee for luggage carts makes perfect sense. It ensures that people who truly value carts will be able to get them and are the only ones paying for them."
"If carts were free or underpriced, more travelers would grab one. That would lead to a shortage, as it has for rent-stabilized apartments. A cart shortage would be a problem for people who overpacked or failed to buy luggage with wheels. They would rather pay $6 than struggle to find a cart. The Port Authority of New York and New Jersey, which runs the airports, might respond to a shortage by adding carts."
"The Port Authority of New York and New Jersey, which runs the airports, might respond to a shortage by adding carts. This would result in induced demand, just like widening a highway draws more vehicles to it. You end up with more congestion, be it vehicles on the interstate or luggage carts at baggage claim. The extra carts would also add cost. Lots of free luggage carts would not really be free."
Understanding basic economics explains why a $6 luggage-cart fee at JFK prevents shortages and reflects true cost allocation. Charging ensures only travelers who value carts pay, avoiding free-rider problems. If carts were free or underpriced, usage would rise and shortages would occur, mirroring effects of rent stabilization. Adding more carts to address shortages creates induced demand and higher costs, similar to highway widening increasing traffic. Many goods and services in the U.S. are cheaper than abroad, so a cart fee does not equate to systemic price gouging. Ultimately, someone must cover the expense of providing carts, whether users or the operator.
Read at therealdeal.com
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