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An Economic History of Zoning and a Cure for Its Exclusionary ...

Source: www.dartmouth.edu
Topic: Economic History

Sort Desciption: An Economic History of Zoning. and a Cure for Its Exclusionary Effects. William A. Fischel. Department of Economics. Dartmouth College. Hanover NH 03755 ...

Content Inside: 1 An Economic History of Zoning and a Cure for Its Exclusionary Effects William A. Fischel Department of Economics Dartmouth College Hanover NH 03755 Bill.Fischel@Dartmouth.Edu (603) 646-2940 fax: (603) 646-2122 Draft of December 18 2001 Abstract (100 words): I outline the twentieth-century history of American zoning to explain how homeowners came to dominate its content and administration in most jurisdictions. Zonings original purpose was to protect homeowners in residential areas from devaluation by industrial and apartment uses that had been made footloose by trucks and buses around 1910-1920. Completion of the interstate highway system around 1970 made jobs and employees so mobile that suburbs adopted growth controls to stem the tide. If zoning is indeed a substitute for home-value insurance it seems worthwhile to investigate the possibility of home-equity insurance to reduce the demand for exclusionary zoning. Acknowledgement: A first draft was presented at the Florida State University Critical Issues Symposium: The Causes and Consequences of Exclusionary Regulations November 8-9 2001. I thank without implicating the conference participants and especially Bruce Benson for their comments. 2 This essay offers an economic explanation for the origins of zoning and its twentieth- century evolution. There are two major puzzles to be explained. First why did zoning rapidly develop in the 1910-1930 era rather than before? Second why did zoning start to have extraterritorial effects on metropolitan housing prices only after about 1970? The purpose of this historical inquiry is to offer a test of the thesis of my book The Homevoter Hypothesis (2001). Its central idea is that the way to understand local government behavior is to see it through the eyes of homeowners and not renters developers business interests or machine politicians who are resident in the community. Homeowners have a special interest in their community that helps overcome the free-rid ...

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