NPR recently published an article on Yosemite National Park and its problem with ticket scalpers. Because of a limited number of campsites—only about 400—reservations for campsites are sold online for $20 a night. Reservations usually sell out within the hour of becoming available, and park rangers suspect ticket scalpers are purchasing large amounts of tickets and reselling them for several times the face value. In response they have taken measures to prevent scalping, going so far as turning away campers whose IDs don’t match the reservations.
Bewildering. If I were in charge, I’d raise the price of the tickets to the current market price, the price of the scalped tickets. Yosemite has set an artificially low price on the original tickets, and the scalpers are taking advantage of the difference between what the campers are willing to pay to camp at Yosemite and the price they paid. The solution is for Yosemite to raise the original price of the tickets. The same campers would be visiting Yosemite, and the park would have more revenues for maintenance and park improvements.
Confused by the decision not to adopt this approach, I looked deeper and learned national parks like Yosemite aren’t allowed to keep the revenues from ticket sales. The receipts go to the Treasury, and funding for the national parks comes from annual appropriations from Congress. Knowing this, I understood my confusion. I assumed the Yosemite would behave as a firm, but national parks are not firms, they are a part of a government agency. Their continuation is not dependent on raising enough revenues to cover their costs but rather annual appropriations from Congress. In other words, they have no incentive to change how they price the tickets because the price of the tickets doesn’t matter to them—they do not keep the revenues.
Clearly, the scalpers at Yosemite are merely a symptom of a larger problem. The park service has less incentive to help cover the cost of maintaining the parks—or reduce the cost for that matter—because they are not ultimately responsible for the money. Instead of turning visiting families away, we should fix the incentives so that our national parks are better managed.