lecture13 - • Government role in urban land market •...

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Unformatted text preview: • Government role in urban land market • Zoning to separate different land uses into separate zones • Growth controls limit population growth • Who wins and who loses? Zoning and Growth Controls: Introduction • Comprehensive zoning started in 1916 • Did change in transportation technology generate zoning? – Truck: Replaced horse cart, causing industry to move to suburbs – Bus: Low-income (high density) households between streetcar spokes – Zoning to exclude industry and high-density housing? The Early History of Zoning • Industrial Pollution – Zoning separates residents from pollution – Zoning doesn’t reduce pollution, but moves it around – Economic approach: internalize externality with pollution tax • Retail Externalities: Congestion, noise, parking • High Density Housing: Congestion, parking, blocked views • Alternative: Performance standards for traffic, noise, parking, views Zoning as Environmental Policy • Some communities eagerly host firms that generate fiscal surplus • Fiscal deficit: Tax contribution less than cost of public services Fiscal Zoning • Large household in small dwelling more likely to generate deficit • MLS exploits complementarity of housing and land • Target lot size: s = v* / (5 • r) – v* = target property value; r = market value of land (per acre) – Example: s = $200,000 / (5 • $80,000) = 0.50 acres Minimum lot size zoning (MLS) • Externality: larger lot generates more space and higher utility for neighbors • External benefit means that lots smaller than socially efficient size •...
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This note was uploaded on 03/08/2012 for the course ECON 155 taught by Professor Klein during the Spring '12 term at Berkeley.

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lecture13 - • Government role in urban land market •...

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