Sunday, September 04, 2011


In his latest weekly WSJ "Mind and Matter" column, Matt Ridley concludes this way: "Sometimes, both in biology and in technology, two good ideas live so far apart that they rarely get a chance to mate."  This is a riff on the widely quoted line from his The Rational Optimist, "I believe that at some point in human history, ideas began to meet and mate, to have sex with each other." 

Ridley evokes the heart of modern urban economics.  Cities thrive and are important because this is where ideas are spawned and refined.  In today's NY Times, Ryan Avent takes it a step further in "One Path to Better Jobs: More Density in Cities."  He criticizes Bay Area (and similar) NIMBY policies that limit densities, push up land prices and, thereby, put a crimp in the whole business.

But that is not the whole stort.  Some of the writers in Randall Holcombe and Benjamin Powell's Housing in America also show that a blind insistence on greater density can be costly. 

So what do we know?  (1) The big metropolitan areas include millions of land parcels and "the correct" density for each cannot be known by planners and policy makers; this is why we have land markets; (2) land markets are supposed to bring forth a pattern of densities that make the whole thing work; you may be the "land use planner" of your very own shopping mall, in which case you would not dream of making a blanket statement that it should be developed at "high" or "low" densities; you would have a complex design in mind, whereby the various parcels are occupied in ways that make the whole project a success; (3) much of the discussion of "density" is incomplete, often simply asserting that density ought to be "high" or "higher"; it is much more complicated; see #1, above.