Can Cities Attract Affordable Housing for Economic Development? The Roles of Growth Management Policies and Urban Political Institutions

Sylvia Gonzalez-Gorman,Sang-Chul Park,Sung-Wook Kwon,Daehee Bak

doi:10.20899/jpna.4.2.181-196

Abstract

While economic development and affordable housing are two important goals for city governments, pursuing both values is challenging due to their conflicting policy nature that is not easily harmonized. Cities inherently focus on economic development policies and tend to pay less attention to redistribution policies such as affordable housing. In this study, we examine why cities pursue both economic development and affordable housing simultaneously in spite of the challenge of balancing two contrasting goals. More specifically, we investigate the influence of state growth management policies and urban political institutions on whether cities support affordable housing to promote their key interest of economic development. Results indicate that state growth management policies are a critical factor that assists city governments attempting to pursue affordable housing and economic development simultaneously, while form of government is not significant.

Highlights

Economic development and affordable housing are two important areas that have been studied in local and urban administrations
The most consistent finding is that the coefficient estimate of the growth management act variable is positive and significant, implying that a city is more likely to attract affordable housing to promote economic development when it is located in a state that has a growth management act
This study finds that city governments are more likely to use affordable housing as a tool for economic development when (1) an existing growth management statute is instituted at the state level, (2) a city has a large populace, (3) a city has a central city status in a metropolitan area, (4) a city has lower economic growth, and (5) a city is affected by higher housing cost and traffic congestion

Summary

Introduction

Economic development and affordable housing are two important areas that have been studied in local and urban administrations. Second-generation growth management policies incorporate effective tools such as impact fees, urban service boundaries, and incentive zoning that allow local governments to pursue a more balanced approach toward preservation and development rather than limiting developmental activities (Feiock et al, 2008). Current growth management acts based on the second-generation approaches aid local governments wanting to undertake economic development and affordable housing simultaneously.

Results

Conclusion