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> it is reasonable to vary pricing in order to equally apply the disincentive.

No, it's not reasonable. The goal is not to discourage use, but to price in the negative externality.

> For your example of trash collection, by having a fixed fee the state creates a greater incentive among the poor to reduce their trash production,

And that's good, even if we suppose your argument is right. Bear with me: what's the percentage of the population in your country that you would call "rich"? Let's say 20%.

Do you think that 20% of the population can create more bags of trash than 80% of the population? I don't think so.

In the parking example, do you think 20% of the population can park more cars than 80% of the population? I don't think so either.

Someone rich may have more than one car, but I strongly doubt they are able to drive 2 cars at once.




I'm pretty sure 5% of the population can create more of whatever negative externality you'd like to tax than the lower 95%. Someone rich might not drive a car at all and instead take a private jet. An average person from the US produces fifty times as much CO2 as an average person from Kenya.


If we were talking about CO2, I'd agree with you.

But we are talking about parking spaces, and production of trash within a country.


The point is not the number of cars or trash bags. It is the incentive to use a vehicle or generate a bag of trash. If a $20/day charge is out of reach for the poor, 100% of the poor will avoid parking and take public transit. If $20/day is meaningless to someone that makes $500k/year, then they will not factor that into their decision to drive versus take public transit. So for those that set prices, does it matter whether demand elasticity is equal across income levels or not?


> Do you think that 20% of the population can create more bags of trash than 80% of the population? I don't think so.

I live in a wealthy household, our discarded amazon packaging, food and meal delivery garbage is easily 4x the garbage produced by a penny pinching household. And so far my housemates and I haven't reduced our consumption because the garbage collection fees do not outweigh the convenience of online shopping.




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