The Italian city and other popular destinations are taking measures to cope with a crush of visitors
By Jennifer Calfas of The WSJ. Excerpts:
"Venice, the Italian city built on more than 100 islands, draws millions of visitors each year with its picture-perfect canals, impressive architecture and priceless artworks. Soon, some of those travelers will have to pay an entry fee as the city looks to combat something else it is known for: overtourism.
City officials are pushing forward a plan to charge day trippers 5 euros, or about $5.40, on designated days in 2024.
The pending policy is the latest effort by cities and leaders in Europe and elsewhere to cope with the crush of visitors that has followed the Covid-19 pandemic and a recent string of bad tourist behavior at popular destinations around the world."
The Venice day-tripper fee will start on busier days in the spring and summer, according to the city. The fee will only apply to people over the age of 14 visiting Venice on day trips. It won’t apply to tourists staying overnight and residents of the city and region, among other exceptions."
If Venice is a scarce good and it is given away for free (that is, anyone can come in without being charged), then there will not be enough to go around.There is not enough to go around in the sense that the crowds make it harder to enjoy the "Venice experience."
It also reminds me of the "tragedy of the commons" which is "which individuals with access to a public resource (also called a common) act in their own interest and, in doing so, ultimately deplete the resource." See Tragedy of the Commons: What It Is and 5 Examples by Alexandra Spiliakos of Harvard Business School's Business Insights.
A typical example is a lake that gets over fished. Each individual fisher catches as much as they can and don't think about the long-run health of the fishery.
Again, the resource (a Venice that can be enjoyed by people) is depleted because there are too many people. Each individual who uses Venice does not consider the cost they impose on others, so it gets over used.
It also reminds me of the Two-part tariff. One example is "amusement parks where there are admission fees and also per-ride fees." If the park is a monopoly, they can charge a low price for each ride but charge a large admission fee to make their money back (and this can actually lead to higher profit than charging the normal monopoly price).
If Venice is like an amusement park, then you pay to get in and still have to pay to take, say, a gondola ride. Venice is a monopoly in the sense that there is nowhere quite like it and it is an island and there are no other major attractions nearby. So this fee could lead to more revenue for Venice in the long run.
See also Two Part Tariff as a Policy Tool for Managing Destinations by Guido Candela, Paolo Figini and Antonello E. Scorcu of The University of Bologna.
"Abstract
A tourist destination might use a two-part tariff (TPT) in which tourists pay a fixed price (e.g., entry fee) and a fee proportional to the length of stay and to the cost of the tourist product consumed. In the TPT framework we can distinguish two cases. In the former, tourists are indifferent between arrivals and length of stay, being their utility only a function of the total number of nights spent on holiday. Such a situation identifies, under general conditions, that the TPT drives the tourist towards a corner solution in which s/he minimises total expenditure by choosing one single holiday of maximum length. In the latter case, arrival and length of stay are two separate arguments in the tourist utility function. The ad hoc management of the TPT tool allows the destination to force the tourist towards its target values of arrivals and length. Such policy could therefore contrast, although only partially, the recent trend in tourism of having shorter holidays."
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