In one of those frequent anti-car threads, I posted the only empirical evidence I could find on how charging for parking reduced business:
Do parking fees affect retail sales? Evidence from Starbucks
"Parking meters are a common feature of urban areas, yet their economic impacts are not well understood. Local governments use meters to raise revenue and to ration scarce parking spaces. On-street parking, however, is seldom priced at the market rate. When inefficiently priced, parking meters may negatively affect the businesses and individuals they are intended to serve. This paper uses a quasi-experimental research design and an observational data set to assess metered parking policy. Sharp twice-daily changes in parking meter enforcement provide a comparison of customer traffic to a popular retail area in free and metered parking environments. Regression discontinuity results suggest that when there is an excess supply of parking (i.e., many spaces are vacant), a small 50 cent per-hour parking fee deters commerce. At two separate Starbucks establishments, the meter fee reduced customer traffic by almost 30%. However, when there is excess demand for parking (i.e., all spaces are constantly occupied), there is no evidence that meters help to increase customer traffic. These results suggest that sub-optimal meter pricing can impose substantial costs on nearby businesses."
The anti-car people weren't happy. Silly cope which didn't even attempt to make an argument aside, one anti-car person claimed that I was misunderstanding the study, and claimed that reducing the number of carpark spots AND charging for them made for an optimal outcome.
I had to explain the study's findings in more detail to him:
"If there're vacant spaces, charging for parking reduces business, because 30% of people don't like paying for parking and people rather not visit than pay for parking
Another anti-car person claimed that the study only looked at customer entries to Starbucks and didn't look at sales figures, pedestrian or cyclist traffic, and that other businesses weren't studied so they might have different results from coffee places. He also cited a City of Toronto study claiming removing parking to create bike lanes improved business.
I had to point out that he was wrong, since the study looked at customers patronising the establishments, not vehicle traffic, and that Gap, Banana Republic (clothing) and Rite-Aid (drug store) were also studied, and for Rite-Aid, parking becoming free increased customer traffic. If his claim were right, cyclists/pedestrians would have to spend a lot more than drivers, since in the case where customer traffic fell by 30%, the average customer in the scenario where parking was chargeable would've had to spend 43% more than in the scenario where parking was free for the establishment to have the same revenue in both instances. Which means that cyclists/pedestrians would've had to spend a lot more than 43% more than drivers (since even in the case where parking was chargeable, many of the customers would've still been drivers - unless he was claiming that somehow, paying for parking means drivers would spend more).
Evidently he did not know that Starbucks was not just a takeout coffee place, but a third space. In any event, for businesses where customers would linger, the expected detrimental effect of charging for parking would be more - because the longer you spend in a shop, the more you need to pay for parking (vs free parking with a $0 cost).
There were also methodological problems with the Toronto study (it was done by the City rather than professional researchers, and wasn't peer reviewed, and had very rudimentary controls). If you dig into the PDF with spending data, one will notice that (methodological issues with omitted variables aside), there was a bigger growth in transactional volume (value of customer spend) city-wide than in the pilot area and a bigger decrease in per-transaction size in the area than in the city as a whole, and we don't know if the differences are statistically significant.
In any event, the Toronto study does not prove that removing parking increased sales (indeed, one city PDF that's linked says that there was an "addition of off-street lot parking spaces and higher utilization in the off-street lots", so it looks like there was still enough parking - which coheres with the study I posted).
More from the paper:
"Consider the following outline of a parking model (developed more fully later in the paper), which illustrates two potential effects of fees on retailers. When parking is saturated (i.e., spaces are used at capacity), per-minute fees generate turnover, which in turn increases customer flow. But increased flow comes at the cost of reducing average shopping time per customer. If purchases increase at a decreasing rate with shopping time, the negative sales effect of shorter shopping times is more than offset by the increase in the number of customers, raising total retail sales. Thus, an increase in parking charges could actually help nearby retailers, which is a potentially surprising conclusion.
However, when parking is not saturated (i.e., empty parking
spaces are freely available), the higher charges do not raise the
availability of parking and thus do not increase customer flow. By
reducing shopping time, higher charges reduce individual purchases and thus total retail sales. This negative effect is compounded when higher charges deter consumers from initiating
shopping trips, amplifying the sales reduction. Thus, the beneficial effect of parking charges for retailers under saturated
conditions is likely to be reversed when parking is not saturated.
The regression results indicate that small per-minute parking
fees can have a substantial effect on commerce. The 10:00 AM
imposition of fees, which occurs at a non-saturated time, reduces
customer traffic in accordance with expectations. At two separate
coffee shops, a relatively small 50 cent per hour meter fee reduced
customer flow by almost 30%. However, the 7:00 PM cessation of
parking charges, which occurs during the saturated period, had
almost no effect on customer traffic at two clothing stores and was
associated with a small increase in traffic at a drug store. These
findings are contrary to the expectation that a reduction in parking
fees should result in a decrease in customer flow. Also, the
regression discontinuity results are subject to one important
caveat: the measured effect of fees on customer traffic should be
interpreted as local effects that are specific to the observed
neighborhood at specific times of day.
These negative findings do not support the argument that
higher parking charges benefit retailers by increasing customer
flow. The only way such an effect could occur is if the higher
charges raise customer traffic under saturated conditions, and the
evidence in this paper does not support such an impact. In sum, the results suggest that conventional metered parking policy can
have significant negative effects on nearby commerce...
Under saturated parking conditions, increased meter fees were hypothesized to generate turnover and thus increase customer flow. Evidence from the evening observation period does not support this hypothesis as the fees had almost no effect when parking was saturated. Customer traffic at the Gap and Banana Republic was constant before and after the cessation of fees, while traffic at Rite-Aid only increased by a small amount. The subsections below analyze the empirical evidence further...
Although one would expect that fees reduce customer traffic in non-saturated conditions, the magnitude of the reduction is surprising, especially given the small size of the fee.
However, an important qualification should be noted before
concluding that parking fees in non-saturated conditions harm the
Starbucks corporation. As coffee from Starbucks C is a perfect
substitute for coffee from the other stores, customers arriving after
9:57 AM may simply drive one extra mile to make their purchase
from the location with free parking. So although fees reduce
customer traffic and may harm sales at an individual store, the
overall impact of fees on multi-store sales may be smaller if people
can easily adjust the location for their coffee purchases. But this
effect would only be large if the parking fees outweigh the cost of
fuel, which is unlikely as gasoline prices were approximately $4.00
per gallon when this data was collected. The empirical evidence
provides only weak support of a location-adjustment effect...
In sum, these findings do not support the claim that parking fees help increase customer flow. Furthermore, the empirical evidence suggests that even in nearly saturated conditions (say 95% occupancy rate), modest fees may still reduce customer flow...
In sum, for both saturated and non-saturated parking environ- ments the empirical evidence does not support the conclusion that parking meters help increase customer flow and thereby increase retail sales.
The results of this study suggest that parking meters with demand-
invariant fees are a poor tool for managing access to popular locations.
There is no empirical evidence to support the claim that fees benefit
nearby businesses by increasing customer traffic. In non-saturated
periods, the fees are not needed to ration parking spaces, and the
evidence shows that Belmont Shore's small meter fees decreased
customer traffic by a significant amount. The magnitude of the effect
— a 25–30% reduction in customer entries at Starbucks — is remarkable, despite the small size of the fee, which amounts to less than 10
cents for customers purchasing coffee to go. Also, contrary to
expectations, this study found no evidence that parking meters help
generate turnover during periods of high demand. When parking was
saturated, Belmont Shore's small fees did not increase customer flow
at nearby retailers...
Compounding the case against demand-invariant parking fees is the fact that a significant reduction in local sales tax receipts would likely accompany any decrease in sales. Considering the small size of the parking fee, a reduction in tax receipts could potentially negate the revenue generating function of the meters. Together, the results suggest that conventional meters are a poor instrument for rationing scarce parking spaces. Thus, the results support the case for more flexible parking fees, ones that vary over time and location. Such parking policies and technologies have been employed successfully in places like San Francisco and could be expanded to other cities in the future"
Related:
How Parking Reform Is Helping Transform American Cities - "The common problem with curb parking is that it is too cheap. All-day parkers (often, local employees) arrive first thing in the morning and take the best spots, leaving visitors to cruise in frustration — a phenomenon that appears to account for a sizable share of traffic in congested places. In San Francisco, meter rates now rise and fall once a month according to how hard it is to find a parking space, with the goal of a free spot on every block. To sweeten the deal for local merchants who fear losing clientele to suburban shopping centers, some cities have re-invested meter money in local improvements... One recent federal study projected that if employees who get free parking at work received an equivalent bonus for not using that parking, traffic in major cities would fall by 10 percent, with equivalent drops in fuel consumption, pollution, and emissions. Free parking is also a strong predictor of car ownership; paid parking is a strong predictor of transit use. If you want less traffic, parking policy is the place to start."
The evidence base for parking policies—a review - "van der Schaaf (2002) reports on a major implementation of city centre parking restraint in Amsterdam which forms part of a large area-wide mobility management plan. Most of the area inside the inner ring road is now subject to significant parking restraint. Car mileage in the historical core has reduced and public transport trips to the centre have increased. However, van der Schaaf notes that the congestion problem has migrated to areas outside the ring road due, in part, to the absence of strong land use policies and parking restraint in these areas. It is suggested that some employment has left the urban core for the periphery (van der Schaaf, 2002) although empirical supporting data is not provided and this phenomenon may be the result of the other non-transport factors described by Gerrard et al. (2002)... Still and Simmonds (2000) reviewed the empirical and modelling evidence on the relationship between parking restraint policies and urban vitality. The study did not find substantial direct evidence of the impacts of parking policy on land-use as such responses are only likely to be seen in the long-term and ‘‘parking restraint policies have not been previously implemented with consistency and longevity’’ (Still and Simmonds, 2000, p. 291). The authors found that ‘‘behavioural and attitudinal studies tend to conclude that strong relationships exist (between parking provision and economic vitaility). Aggregate statistical studies on the contrary find only a very weak relationship’’ (Still and Simmonds, 2000, p. 313). Modelling work conducted to augment the study suggested that where strong parking restraint is introduced in the city centre but not elsewhere in the city this can have negative impacts on the city centre."
Somehow I doubt they proved causation for free/paid parking and car ownership/transit use