The Warm Glow of DC Buses

    While living in DC over the summer, I often used the Metro system to get around the city. At first, I maintained the responsible approach and paid for every one of my rides, swiping the card without thinking. Eventually after around ten rides, I began to notice an expected but concerning trend: I was only one of a few people who actually swiped my card for the buses. Other riders would either enter through the exit or simply walk right past the payment machine. A clear free rider problem was at play here. The local city government, the few farepayers, and the Federal COVID stimulus had to shoulder the burden of funding this public good, and ended up under-providing the good, creating a positive externality. The fare system and its enforcement by Metro officers provided excludability for the bus rides, but, due to the Pandemic, fares were relaxed and Metro officers no longer rode on the buses. Buses became a impure public good, where it is rival but non-excludable. One person's enjoyment of the bus would affect the enjoyment of another person due to crowding, but there were no longer measures to maintain excludability. Once I realized one did not have to pay to use the bus, we had all become free riders. 

    There are, thankfully, solutions to the free rider problem, but none of them are perfect. Reinstating the laws around paying the bus fare would temporarily increase fare payments, but methods for avoiding fares like entering the exit and fighting the bus driver would return from the past. The people who take the buses have grown accustomed to riding for free in nice air conditioning for as long as they want. Buchanan, in his writings, offers some thoughts around the free rider problem. The warm glow effect and altruism are more psychological than economical but they both combine in this instance to raise the possibility for greater fare payment. They both deal with the private marginal benefit gained from "doing your part." For bus takers, paying the fare creates private marginal benefit as one contributes to not only their conscious but also the DC Metro system. For example, I noticed that whenever a bus driver greeted the passenger at the door, the person was more likely to pay, as they would derive personal enjoyment or benefit from the act of paying. If bus fare is $2, the added PMB from the warm glow effect will provide consumer surplus for a paying bus passenger. The first time I did not pay the bus fare, the person behind said "Man, some folks just don't care." She had to pay while I got to derive benefit from it in the same way. Her moral compass and ethics provided private marginal benefit in her decision to pay the fare and she derived some consumer surplus or "moral profit." She, in fact, experienced the warm glow. While not a catch all, the warm glow effect certainly exists on public transit. The real solutions, however, must combat growing distrust of local government, infrastructure issues, and decreasing Federal funds, but perhaps through the warm glow and the reinstatement of stricter fare laws can combine to mitigate a small amount. 

https://www.washingtonpost.com/transportation/2022/02/07/metro-fare-evasion-pandemic/