The Economics of Queues and Waiting
Why We Queue
Queues form whenever demand for a service at a moment exceeds its capacity, and waiting is a hidden price we pay instead of money.
A queue appears when more people want a service than can be served at once. It is one way of rationing scarce capacity.
Waiting as a price
When prices don’t rise to match demand, time becomes the cost: people pay with waiting.
Everyday examples
Ration shops, hospital OPDs, ticket counters, traffic signals, bank branches and call centres.
The economist’s view
Time has value, so long queues waste resources.
A hospital OPD
Patients arrive at dawn to get a token because the fee is low and the doctors are few.
Thinking queues are only a nuisance
They signal a mismatch between supply and demand.
Key takeaways
- Queues occur when demand exceeds capacity.
- Waiting is a cost.
- Time has value.
- Queues signal scarcity.
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