New Jersey's Insane Ban on Self-Service Gasoline

A blog about business and economics.
Sept. 18 2013 11:00 AM

New Jersey's Insane Ban on Self-Service Gasoline

Fun flashback: This is how much gas cost in Jersey City, N.J., on May 20, 2004.

Photo by Chris Hondros/Getty Images

Driving up and back to the Mohonk Mountain House for the Slate retreat, my colleague David Weigel had one goal in mind—don't buy gasoline in New Jersey.

And he succeeded. Our northbound refueling took place in New York, and our southbound refueling was in Maryland. Megan Wiegand, driving a separate car was not as lucky, and she needed to stop in New Jersey. Why do people hate stopping in New Jersey for gas? It's simple. Self-service gasoline is illegal in the Garden State, a policy that Oregon also shares. I don't drive enough to have strong feelings about this, but many drivers find it so disconcerting to need to interact with another human being while refueling that they deliberately avoid Jersey gas even though it's cheaper than the gas for sale in New York, Connecticut, Pennsylvania, Delaware, and Maryland.

But it's the source of this cheap gasoline that makes it especially pernicious. Obviously all else being equal, if you ban self-serve gasoline, you're going to push prices up. New Jersey compensates for this by having an unusually low gasoline tax.


That ends up depriving the state government of a source of revenue that scores unusually well on the economic efficiency scale. It's a consumption tax, which economists generally like. But it also penalizes an environmental externality (burning fuel), and since poor people tend not to own cars, it doesn't have the regressive implications of a sales tax. Maryland is being smart and raising its gasoline tax to save for the future by investing in transportation infrastructure. New Jersey, meanwhile, is stuck in a dysfunctional equilibrium of underinvesting in its infrastructure, underpricing gasoline, and annoying everyone with an inefficient gasoline delivery system.

The idea, presumably, is that this saves jobs. But you could apply that Luddite logic to anything. New Jersey could ban washing machines to create more employment in the maid sector. Yet nobody does that because it would be insane. And it's not as if "gas station attendant" is such a wonderful job that it makes sense to create an industrial policy strategy around maximizing the number of jobs in that particular field.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.


Medical Examiner

The Most Terrifying Thing About Ebola 

The disease threatens humanity by preying on humanity.

I Bought the Huge iPhone. I’m Already Thinking of Returning It.

Scotland Is Just the Beginning. Expect More Political Earthquakes in Europe.

Students Aren’t Going to College Football Games as Much Anymore

And schools are getting worried.

160 Countries Host Marches to Demand Action on Climate Change


Blacks Don’t Have a Corporal Punishment Problem

Americans do. But when blacks exhibit the same behaviors as others, it becomes part of a greater black pathology. 

Why a Sketch of Chelsea Manning Is Stirring Up Controversy

How Worried Should Poland, the Baltic States, and Georgia Be About a Russian Invasion?

Trending News Channel
Sept. 19 2014 1:11 PM Watch Flashes of Lightning Created in a Lab  
  News & Politics
Sept. 20 2014 11:13 AM -30-
Business Insider
Sept. 20 2014 6:30 AM The Man Making Bill Gates Richer
Sept. 20 2014 7:27 AM How Do Plants Grow Aboard the International Space Station?
  Double X
The XX Factor
Sept. 19 2014 4:58 PM Steubenville Gets the Lifetime Treatment (And a Cheerleader Erupts Into Flames)
  Slate Plus
Tv Club
Sept. 21 2014 1:15 PM The Slate Doctor Who Podcast: Episode 5  A spoiler-filled discussion of "Time Heist."
Brow Beat
Sept. 21 2014 2:00 PM Colin Farrell Will Star in True Detective’s Second Season
Future Tense
Sept. 19 2014 6:31 PM The One Big Problem With the Enormous New iPhone
  Health & Science
Bad Astronomy
Sept. 21 2014 8:00 AM An Astronaut’s Guided Video Tour of Earth
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.