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Tips for panhandlers, from panhandlers
Currently, the direct, humorous approach is in vogue. That's why in many cities today you'll hear some version of: "I won't lie to you, I need a drink." Panhandlers also report that asking for specific amounts of money lends credibility to pitches. "I need 43 more cents to get a cup of coffee," a panhandler will declare; some people will give exactly that much, while others will simply hand over a buck.
Oddly, the tips are offered on-line:
If it seems unlikely that a homeless person would surf the Web for advice on how to panhandle, that's exactly the point: many aren't homeless and are lying about their circumstances.
And what's the rate of return?:
Anecdotal surveys by journalists and police, and even testimony by panhandlers themselves, suggest that begging can yield anywhere from $20 to $100 a day—though police in Coos Bay, Oregon, found that local panhandlers were taking in as much as $300 a day in a Wal-Mart parking lot. “A panhandler could make thirty to forty thousand dollars a year, tax-free money,” Baker says.
Posted by Tyler Cowen on September 3, 2008 at 08:24 AM in Economics | Permalink
Comments
Your article does mention peer review, which I have seen on couple occasions at Harvard square. A group of pan handlers will gather and critique each others pitch and signs. At one session I witnessed, one had evidently come up with a brilliant sign, as the ohhs, ahhs and exclamations of the fellow pan handlers were universal and abundant. Sadly, I could not see the sign.
Posted by: at Sep 3, 2008 8:36:00 AM
Coos Bay? Odd... that's not a particularly well-off area of Oregon, having been hit pretty hard by the decline of the timber and fishing industries. I suppose that begs the question of what "earnings" are in poor vs wealthy areas, and why.
Posted by: David N. Welton at Sep 3, 2008 8:44:21 AM
I often see estimates on the upper end of panhandlers' earnings, but never the median. The statements seem a bit like the pitches in work from home schemes, often down to the wording. (Make $200 per day!)
Posted by: Cyrus at Sep 3, 2008 8:56:45 AM
This is pretty old news. Maybe the panhandling fads start in NY (as many fads do) but the "truth-telling" about alcohol with humor (or humor alone: best homeless charity you can find, 100% of your contributions will go to the homeless), and the exact change story (bus to NJ) are old hat there. And there were stories in the Times... panhandlers making several hundred a day and $500+/day in the best spots (on the best days).
Those top spots are fiercely protected, like gangs guard their territories, or like vendors. The funniest of them are a lot like tourist attractions - entertaining tourists and working on tips.
Not sure how this has changed over the past decade, but there is surely a lot of interesting economics in this industry.
Posted by: liberty at Sep 3, 2008 9:04:12 AM
David N. Welton: It's well known among those who ask for donations (think the bell ringers at Christmas) that you'll do better at Wal-Mart than at a more upscale store. I've heard this on multiple occassions in different regions of my state (North Carolina) and once more from a very bright psyc professor.
Posted by: Levi at Sep 3, 2008 9:21:23 AM
"If it seems unlikely that a homeless person would surf the Web for advice on how to panhandle, that's exactly the point: many aren't homeless and are lying about their circumstances."
On the other hand, homeless people can and do use the public library, including its free computers and internet access.
Posted by: M Wms at Sep 3, 2008 9:27:05 AM
Speechless panhandling can be very effective. One day, I walked out of the metro and found a middle aged man, decently dressed, standing up straight against a pole, holding a cardboard with both hands, looking pale and devastated. I forget what was written on the card board. I gave him money. Another speechless panhandler I like a lot is a black guy with a trombone that he blows like a bugle. He plays only one Christmas tune out of his lung all year round. It is fun to hear it in the morning. I give him money whenever I am chipper.
Posted by: Yan Li at Sep 3, 2008 9:27:41 AM
I think the "online equals lying" note is only marginally true. Go to any NYC public library except for the main branch and hang out at the computer stations. You'll often see a rather unkept person or two asleep at a keyboard, browsing a web-based email account or a forum or something like that.
The library is not only a good, quiet place to read. When you're homeless, it's also a good, quiet place to sleep; and now, a good place to communicate with the outside world.
Posted by: DNL at Sep 3, 2008 9:32:46 AM
There was a guy in Tallahassee who used to stand on the corner of Monroe and Appalachee Parkway that had the "Why lie I'd love a beer" sign. This was at a minimum 5 years ago and more likely around 8-10 years ago. Guy would, so the rumor goes, make a decent amount of money.
Levi - I can see this being true, although I don't precisely know the reason why. Is it possible that there is a cash/plastic effect here? Wealthy people in wealthy stores may be using plastic and have little cash (and what cash they do have may be in $10/$20/$100 denominations), whereas those shopping in the Wal-Mart are more likely to be carrying cash in lower denominations?
Posted by: AZ at Sep 3, 2008 9:58:30 AM
Outlawing panhandling is futile because most beggars don't care about breaking the law. A much more effective method is to outlaw giving money to beggars.
Posted by: Peter at Sep 3, 2008 10:03:15 AM
Following up on DNL: At least in DC, it's common for homeless men and women to spend hours at the MLK library surfing the web using the library's computers.
Posted by: SL at Sep 3, 2008 10:07:18 AM
Just because someone is panhandling doesn't mean they are homeless. It isn't lying to just sit on the street and ask for money. It's only lying if you claim you are homeless while you ask for money. Most don't, they just ask for money.
Posted by: Sameer at Sep 3, 2008 10:12:06 AM
"Sharpe's Fury" by Bernard Cornwell has a nice section about gangs of professional beggars using violence and intimidation to protect their turf in England and Spain.
Posted by: Ned at Sep 3, 2008 10:13:59 AM
I'd hazard there is a high return to skills in begging on the street, with the consequent high variance in income. I'd also hazard skill at begging correlates highly with labor market skills.
Posted by: stefan at Sep 3, 2008 10:27:45 AM
What percentage of panhandlers are homeless?
Posted by: Martin at Sep 3, 2008 10:44:58 AM
Alex already posted on the same story two weeks ago:
http://www.marginalrevolution.com/marginalrevolution/2008/08/markets-in-ev-3.html
Posted by: Jake at Sep 3, 2008 10:45:21 AM
Sounds a lot like graduate school, research on the internet, sitting around and telling stories, and tax-free status. However, seems that it pays better. I can see the appeal.
Posted by: mt at Sep 3, 2008 10:50:40 AM
People still repeat those stupid "panhandlers make a ton of money" stories? These stories are obvious BS (how could a panhandler possibly make $300 a day in spare change and $1 bills? Where is he keeping all this money as he collects it?) and basically serve as a rationalization of our amazing greed.
Posted by: Dan Tarrant at Sep 3, 2008 10:52:15 AM
I liked the note about converting some parking meters to donation stations.
It would be interesting to allow panhandlers to rent blocks in return for a cut from the adjacent meters. Enforcement of stiff penalties for accosting people could be supported out of the till. Fines against the donations for unkempt streets complaints could lose them their franchise. I'm sure panhandlers hate dealing with the public as much as other retail workers.
Posted by: Andrew at Sep 3, 2008 10:52:56 AM
This is as good a time as any to remind people of Orwell's Down and Out in
Paris and London. Still has a lot of resonance in discussions like this one.
Posted by: Jarndyce at Sep 3, 2008 11:04:36 AM
"People still repeat those stupid "panhandlers make a ton of money" stories? These stories are obvious BS (how could a panhandler possibly make $300 a day in spare change and $1 bills? Where is he keeping all this money as he collects it?) and basically serve as a rationalization of our amazing greed."
1. Many people give in higher denominations (at least in NY). The NJ bus stories often rake in $5 at a hit.
2. They spend some of it along the way (and maybe trade in for higher denominations).
3. They have big pockets, and yes, wallets.
Most tips-based industries deal in small denominations-- where do strippers keep all those ones? They have a system.
Note: most panhandlers don't earn this much every single day -- it is good days and good spots where this much is earned. But the halfway decent panhandler in NY earns a lot more than you think.
Posted by: liberty at Sep 3, 2008 11:06:09 AM
Well, of course a panhandler in Manhattan is going to earn more than one in Peoria. The rest of that stuff you just pulled out of thin air.
The point, anyway, is that we all know that most panhandlers are not there because it's lucrative yet we repeat these stories so we don't feel bad about not sharing our money.
Posted by: Dan Tarrant at Sep 3, 2008 11:19:36 AM
The resourcefulness of panhandlers is very intriguing. And the fact that the beggars are turning to the internet for tips on illustrates the human capacity for adaptation. Regardless of morality, these people are making the best use of free resources (internet, cardboard, newspaper)available to them. Scavengers are present in every ecosystem, and like the crab or vuluture or any other saprophytic being panhandlers have and will continue to evolve.
For whatever reason (drugs, psychological problems, etc.) these people find themselves completely dependent on others for income. If the panhandler seems sincere, most folks will toss a few coins their way. Which in some sense is admirable but is also enabling the beggar to continue to leech off of society. The next time a panhandler asks for change, them him change comes from within.
Posted by: anon at Sep 3, 2008 11:24:45 AM
enabling the beggar to continue to leech off of society
That's only true if you think not giving a beggar money will inspire him to clean up and find honest work.
In reality, it's more correct to say that you're bribing the beggar not to become a criminal.
Posted by: Edgeth at Sep 3, 2008 11:45:19 AM
we all know that most panhandlers are not there because it's lucrative
No, we don't all know. I don't. Neither do you.
Go do proper research then report the results.
The trolls this blog has attracted after the Palin post (800 comments and still going strong) is unfortunate.
Alex and Tyler - is it Tyrone who is insisting you not turn the comments off on that post?
Posted by: at Sep 3, 2008 12:19:54 PM
