Endogenous open space amenities in a locational equilibrium

Abstract

Little is known about the equilibrium impact of open space protection and growth control policies on the entire metropolitan landscape. This paper is an initial attempt to evaluate open space policies using an empirical approach that incorporates the endogeneity of both privately held open space and land conversion decisions in a locational equilibrium framework. The analysis yields four striking results. First, when one allows for endogenous adjustments in privately held open space, increasing the quantity of land in public preserves may actually lead to a decrease in the total quantity of open space in a metropolitan area. Second, different strategies for spending the same amount of money to purchase open space have markedly different landscape and welfare implications. Third, partial equilibrium welfare calculations are extremely poor predictors of their general equilibrium counterparts. And finally, the analysis suggests that while a growth ring strategy is most effective in reducing total developed acreage in the metropolitan area, this reduction in developed acreage is associated with a large net welfare loss.