In this article about food trucks, Ed Glaeser doesn’t mention their educational value: They allow people with a new idea to test it relatively cheaply. If it works they can expand. I saw this happen in Berkeley. A food truck that sold stuffed potatoes eventually became a store that sold the same thing. Food trucks don’t merely create jobs, they can create the best kind of jobs: Those that provide new goods and services. Unlike jobs created by building dams or highways.
Any advanced economy needs a constant stream of new goods and services to replace the ones that are inevitably lost. It goes against the survival instincts of people in power (government officials) to help those at the bottom (e.g., potential food truck owners) because they seem so much less powerful than those at the top (e.g., restaurant owners) who are threatened by those at the bottom.
All this should be utterly obvious — as it is to anyone who has read Jane Jacobs on economics. But it isn’t. In science, too, every field needs a constant stream of new empirical effects (in experimental psychology, new cause-effect relationships) to replace the ones that have been studied to death. So every field needs a cheap way of searching for those effects, but no field, as far as I know, has such a way. In science, editors and reviewers are like government officials. They can discourage new ideas (food trucks) by enforcing “high standards” (regulations) whose costs they fail to understand.
Via Marginal Revolution. “[David] Westin’s biggest weakness [as head of ABC News] was that he lacked the entrepreneurial spirit to launch innovative and creative ventures.”
There’s more economic wisdom (and other wisdom,too) in those two paragraphs than many economics students get in a year of study. Perhaps If more economists would try to make working food trucks, or some equivalent, they might learn this, and then be able to teach it?
By the way, here’s another economist commenting on economic education: https://aidwatchers.com/2010/09/welcome-to-economics-all-you-students-and-aid-workers/
That link came via Marginal Revolution, too…
Similar thing happens with patents – it costs money to take out a patent so the ideas of the poor are squandered and powerful companies can take out patents in their thousands just to prevent others from actually using the ideas. This obviously causes technological, social and economic stagnation.
I’d actually disagree. In many ways, food trucks are the anti-thesis of Jacobs ideas about what makes a good cities. Food trucks pay no rent, don’t renovate spaces, operate mostly cash businesses, and have no vested interest in the neighborhood. In fact, in many cases they operate on incentives as big box retailers which is to identify lively, robust communities, and siphon out money from it. For instance, you’re a restaurant who has worked hard to draw people/attention/other businesses to your surrounding area and navigated through the various regulations that the government forces business owners to jump over. Then a food truck – which is subject to none of those rules – parks outside your attractive location and takes away customers. (meanwhile, adding none of the benefits that you do – taxes, employees, etc) How would that be something Jacobs would support?
Food truckers aren’t less powerful, they are less meaningful and valuable to communities. Rarely is this true, but I think governments are mostly correct in their reactions against them.
Btw, I’d make a distinct difference between taco trucks and ice cream trucks which have always existed and benefited underserved communities and the new generation of gourmet food trucks which nerds can’t seem to stop blowing.
Ryan, in her later books on economics, such as The Economy of Cities, Jacobs tacitly recognized that her first book (about city planning) was actually a small part of a bigger picture. You can have all the old buildings, infill and short blocks you want but still do badly if other things are unfavorable. Food trucks are a way of helping small things (e.g., one person who wants to enter the food business) become bigger — become someone who can afford to open a restaurant and has the necessary business skills.
I think your generalizing from a relatively rare occurrence. Most food truck owners don’t go from truck to brick and mortar. They go from truck to more trucks because the economics are better – they don’t have any of those pesky commitments to anyone but themselves.
We, as a people, decided the regulations we enforce on restaurant owners are important. Things like health standards, minimum wages, zoning ordinances and so on. It’s misguided to hold up food truck owners as examples of innovation or whatever, because the reality is they flout the very constraints we decided were necessary in the food industry and punish the real community builders by pocketing the better margins and stealing their business.
“Food trucks don’t merely create jobs, they can create the best kind of jobs: Those that provide new goods and services. Unlike jobs created by building dams or highways.”
Why do you say that dams and highways don’t provide goods and services? They may not provide buttered potatoes, but they provide electricity and transportation.
Dams and highways are unlikely to provide NEW goods and services. Too much is at stake for innovation.
We, as a people, decided the regulations we enforce on restaurant owners are important. Things like health standards, minimum wages, zoning ordinances and so on. It’s misguided to hold up food truck owners as examples of innovation or whatever, because the reality is they flout the very constraints we decided were necessary in the food industry and punish the real community builders by pocketing the better margins and stealing their business.
Some sloppy thinking here. Who’s “we”? What’s “flouting the constraints ‘we’ decided were necessary”? Do you know for a fact that they are violating “health standards, minimum wages, zoning ordinances”?
You don’t, because the trucks are not breaking the law; they’re offending your sensibilities.
There are windfall profits to the first-mover, and the fact that one business takes traffic from another is just life. Two years ago, I was one of the thousands checking Twitter and racing off at 1am to check out a nearby Koji fusion Korean truck. But once I got there, the food was no biggie, and standing on a sidewalk in an industrial area with meat juice running down my arms wasn’t exactly magical. I never went again. It was not quite as silly as the Tamagotchi craze — sometimes you get hungry, but you never really need a Tamagotchi — but it was still a little lame.
And now there’s a stampede into the niche. Eventually there will be more regulations as the bricks and mortar businesses complain.
I think the alternative food truck thing is already overplayed, at least in LA (where it seems to have started.) A clear signal is the fact that Sizzler is right now building a fleet of them. Once people start to equate food trucks with Sizzler, they will no longer think of food trucks as interesting and kicky….they will be right back to the “roach coach” perception, and there will be a crapload of money lost on now-useless trucks.
And most of the new trucks are being built by companies with bricks and mortar outlets. IE, Border Grill, an expensive downtown LA restaurant, has at least one truck. But I wonder if people will be willing to pay the premium at the restaurant for something the truck dishes out for cheap, without even needing to schlep downtown? (Koji’s trucks can’t damage their B&M outlets; they don’t have any physical outlets.)
I would be pretty fricking furious if I were a bricks & mortar Sizzler franchisee, though.
I’m way late to the party.
I think (Ryan) you’re taking the point and running away with it. What we’re working with here is the idea that food trucks provide an avenue for innovation for culinary workers. They can enter the marketplace with a new idea – a new baked potato – and test it out with the relative ease of food trucks. Roberts is arguing that any economy that hopes to thrive shouldn’t constrain these measures, you’re saying the government should regulate food trucks heavily because they’re a burden to employers and taxpayers.
But that goes a little too far. After all, it’s just a food truck – in most every case, it hits a pretty low ceiling. If the demand for their menu grows high, this food truck won’t satisfy that demand with more food trucks. Nor is he likely to satisfy that demand by parking outside the premium real estate of other restaurants, eschewing property taxes and proper health codes. If the consumer is left to decide, most people usually prefer eating inside, on a table, in the confines of a restaurant. That’s why restaurants are more profitable, and why they’re taxed more heavily.
All we’re dealing with here is giving good ideas a chance to reach the marketplace. You can do that with food trucks, but if the consumer is left to decide what he wants, the food truck will only survive so long before it gets passed over for a restaurant.