The Car Guards of Cape Town: A Public Good Analysis

This paper analyses the development and economic functioning of the car guards industry with the understanding that the market exhibits quasipublic good characteristics.

Car guards have become a part of everyday life for drivers in Cape Town and other metropolitan centres around South Africa. This paper analyses the development and economic functioning of the industry with the understanding that the market exhibits quasipublic good characteristics. Some unusual phenomena are explored. Firstly free riding does not lead to under-provision in the market due to the survivalist nature of the supply, the noncontractual nature of the demand and varied public perceptions. Secondly private firms enter the market as a signalling device for the heterogeneous quality of car guards. Lastly drivers continue to pay car guards in the face of free riding due to varied preference curves and a degree of altruism in rational agents. Twenty detailed case studies are undertaken and the results presented and used to inform the theoretical conclusions made throughout the paper.

EfD Authors

Associate Professor Anthony Leiman Research Fellow

Keywords

Public goods

Files

leiman2008_25.pdf 423.1 kB

Centers

south africa

Type of publication

Discussion paper

Reference

Hayley McEwen and Anthony Leiman, 2008, "The Car Guards of Cape Town: A Public Good Analysis", Saldru Working Paper 25.

Environment for Development

Environment for Development