Abstract
Problem statement: Local jurisdictions such as cities and counties enact a wide variety of growth-management regulations, such as zoning ordinances and growth-promoting incentives. Approach: Use a theory of local public goods to identify the conditions under which jurisdictions are most likely to implement growth-management regulations. Predictions of the theory regarding variation in pro-growth measures across jurisdictions were tested using data on California cities. Results: Communities whose current expenditures on public amenities are high typically have more extensive growth-promoting policies, while communities that already have substantial public infrastructure in place are less likely to implement effective pro-growth measures. Conclusion: These findings suggest that changes in stocks and flows of public goods can be used as predictors of the incidence of growth controls.
Highlights
As California’s population density has increased over the past three decades, local jurisdictions have enacted an increasing number of regulations and ordinances designed to manage or control growth
Local growth controls are an issue of concern for California because rapid expansion of the state’s population threatens to outstrip the supply of housing, resulting in further increases in real estate prices and shortages of affordable housing for lowand moderate-income groups (Levine, 1999)
We use a theory of local public goods to explain the reasons that jurisdictions adopt such measures and to suggest the circumstances that are most likely to lead to these policies being implemented
Summary
As California’s population density has increased over the past three decades, local jurisdictions have enacted an increasing number of regulations and ordinances designed to manage or control growth. The provider of a local public good must decide on the optimal quantity of the good to supply as well as the optimal number of users to share in its consumption and to help pay for it through dues, fees or taxes. If the number of users is too great, congestion will occur These two countervailing effects need to be balanced at the margin to determine the optimal quantity of the public good and the optimal number of users. There needs to be some mechanism to regulate entry in order to keep the sharing community at its optimal size
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