Michael Munger on the Political Economy of Public Transportation

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4.7 • 4.4K Ratings

🗓️ 7 July 2008

⏱️ 56 minutes

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Summary

Michael Munger of Duke University talks with EconTalk host Russ Roberts about Munger's recent trip to Chile and the changes Chile has made to Santiago's bus system. What was once a private decentralized system with differing levels of quality and price has been transformed into a system of uniform quality designed from the top down. How has the new system fared? Not particularly well according to Munger. Commuting times are up and the President of Chile has apologized to the Chilean people for the failures of the new system. Munger talks about why such changes take place and why they persist even when they seem inferior to the original system that was replaced.

Transcript

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0:00.0	Welcome to Econ Talk, part of the Library of Economics and Liberty. I'm your host Russ
0:13.4	Roberts of George Mason University and Stanford University's Hoover Institution.
0:18.6	Our website is econtalk.org where you can subscribe, find other episodes, comment on
0:24.5	this podcast, and find links to other information related to today's conversation.
0:29.9	Our email address is mailadicontalk.org. We'd love to hear from you.
0:37.2	My guest today is Mike Munger of Duke University. Long time contributor to the Library of Economics
0:44.0	and Liberty and to this podcast econ talk. Mike, welcome back.
0:48.0	It's great to be here.
0:50.5	I want to talk about your recent trip to Chile and your insights there about markets and
0:56.3	incentives, which is our general topic today. Some of the peculiar ways that we think
1:01.1	about markets and incentives, tell me about your trip.
1:04.3	Well, I just got back from Santiago last night, so I'm still a little bit disoriented.
1:09.0	It was snowing pretty hard up in the mountains when I left and it's kind of hot in North
1:12.8	Carolina now. A lot of the time when I'm riding around in Santiago, traffic's pretty bad.
1:21.9	I was thinking about kind of the interesting role that Chile has in a move towards using
1:27.8	more private rather than public solutions for all sorts of things.
1:30.9	Chile, for a long time, had a private mess transit system. They've privatized a number
1:34.6	of their schools. It's been a laboratory for the contest between what should we do through
1:41.6	contracts and markets and what should we do through the public sector.
1:46.0	It made me think about a number of things that we have objections, people object to using
1:51.4	contracts, object to using incentives and markets, and they mean it have thought much
1:56.0	about why. It was a really long flight and I spent most of it thinking on the way back.
	...

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