Tuesday, October 27, 2009

Supply and Demand in Action: 1-Way Truck Rentals

I've posted numerous times (here, here, here and here) about how one-way U-Haul truck rental rates reflect supply and demand in action and measure household migration patterns, resulting in high one-way rental prices that reflect high outbound demand (and low inbound demand), and low prices that reflect low outbound demand (and high inbound demand).

Now MSN Money reports on this phenomenon in an article "
Where Jobs Are: The U-Haul Indicator"

One measure of a region's economic health is the relative price of moving-truck rentals. It has been said that people vote with their feet. They pick up and go to where the jobs and opportunities are. The hard part is that it costs more -- a lot more -- to move to where the jobs and opportunities are than to move to where jobs and opportunities are limited. My favorite measure for this doesn't come from the Bureau of Labor Statistics. Nor does it come from any other agency of the federal government.

It comes from U-Haul, the truck and trailer rental company. It has on-the-ground evidence and prices its rentals accordingly. Go to its Web site, and you can learn quickly where people are going. You can also learn where they are leaving. How will you know this? Simple.

If lots of people are trying to go where you want to go, it will cost a lot more than renting equipment to go to the place everyone is trying to leave. Just as there is a law of supply and demand, there is a law of arrivals and departures.


MP: The U-Haul analysis has been circulating around the blogosphere for more than four years now, see Club for Growth (Andy Roth in Aug. 2005 was the first), Marginal Revolution (Sept. 2009) and Freakonomics (Sept. 2009). So you heard it first in the blogosphere, and four years later in the MSM.

8 Comments:

At 10/28/2009 12:33 AM, Blogger Michael said...

Mark, when you finally decide to leave the state, please remember to turn out the lights.

 
At 10/28/2009 1:58 AM, Anonymous Anonymous said...

Should the next-to-last word in the first paragraph be "inbound"?

Love your site. Best wishes from Kansas! --Redbud

 
At 10/28/2009 2:51 AM, Anonymous richard said...

Mark,

> Now MSN reports on this phenomenona in an article "Where Jobs Are: The U-Haul Indicator"

I think the link is broken.

 
At 10/28/2009 4:05 AM, Anonymous Anonymous said...

MP: You heard it here first.

Don't think so.

 
At 10/28/2009 7:37 AM, Blogger Mark J. Perry said...

Sorry, a) the text has been corrected, b) the link has been fixed, and c) credit has been given to the earlier bloggers who have posted about U-Haul rates.

 
At 10/28/2009 8:45 AM, Blogger JimJinNJ said...

Love it.
Suggestion for all: I believe it is time to end all comparisons and references to the MSM. It/they are old news, worn out, subverted, underfunded, overly biased, and shrinking. It is like comparing jet flight to walking overland.

The MSM is no longer "main stream" but "marginal". How about "marginally surviving media"?

 
At 10/28/2009 10:34 AM, Anonymous Anonymous said...

The U-haul indicator has been on the blogosphere since at least 2003, found here. It looked liked it was picked up from the MSM (The Financial Post).

I believe that it has always been more expensive for do-it-yourselvers to travel one-way from some metropolitan areas to others and not every move is employment related. Without a longitudinal study, the indicator seems practically worthless.

For the non-do-it yourselvers utilizing moving companies, the migration patterns seem much more subdued. See Atlas and United, particularly the Atlas data which goes back 10 years.

 
At 10/28/2009 1:15 PM, Blogger OA said...

Well, I saw it here first as I haven't been trolling blogs for much time.

Regardless of whoever saw what first though, I would guess there are far more people reading this blog who understand it than those reading MSN. Even though the article takes time to explain what it is trying to say, look at the comments at the bottom of the article.

 

Post a Comment

Links to this post:

Create a Link

<< Home