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I used to support the view articulated in this article, but I'm more skeptical now. If higher density were the solution I would expect to see highly dense citi

I used to support the view articulated in this article, but I'm more skeptical now. If higher density were the solution I would expect to see highly dense cities have cheaper real estate than less dense cities. Instead, it's just the opposite. That's because of the other side of the economic equation: demand. And therein lies the devil. I hypothesize that increasing the supply of housing in a city actually increases demand in such a way that the supply increase has little downward effect on housing costs. It makes sense why this is the case. If more people live in a city, then there's more people who are likely to move there. If you know a bunch of classmates who are all moving to San Francisco after graduation that's going to make you more likely to move to San Francisco too. So yes, supply exerts downward pressure on housing costs, but I would bet that heigthened density then causes a near commensurate increase in demand such that the supply increase has little effect.

brighteyes 11y ago
The problem is that the increased density is happening anyway. It isn't that if we build more housing, more people will come, which will bring more people in an exponential cycle. The reality is that tech workers are coming anyway, and paying whatever is required of them to live in SF. They aren't being stopped by high rents, because high as they are, they can afford them. However, they are raising prices for people that can't afford it. That pushes other people out. The result is that whether we build or not, tech workers will live in the city. Building more won't bring more of them. The only question is whether other people can live there too.
- Tempest1981 11y ago
  Similarly, I used to think that terrible traffic would discourage growth. Not really... people's tolerance is surprisingly high.
deleted 11y ago
[deleted]
natrius 11y ago
This is just wrong. Every reputable economist I've come across disagrees with what you're saying. As with climate change, if we ignore experts, we will needlessly careen toward disaster. Conservative economists like Edward Glaeser have long opposed restrictive zoning[1]. President Obama’s Chief Economist sees that “income inequality across cities remains entrenched and may even be exacerbated” as a result of restrictive zoning[2]. According to Nobel laureate and New York Times columnist Paul Krugman, “this is an issue on which you don’t have to be a conservative to believe that we have too much regulation.”[3] [1] http://www.city-journal.org/2008/18_3_houston.html http://www.city-journal.org/2008/18_3_houston.html [2] https://m.whitehouse.gov/sites/default/files/page/files/20151120_barriers_shared_growth_land_use_regulation_and_economic_rents.pdf https://m.whitehouse.gov/sites/default/files/page/files/2015... [3] http://www.nytimes.com/2015/11/30/opinion/inequality-and-the-city.html http://www.nytimes.com/2015/11/30/opinion/inequality-and-the...

brighteyes 11y ago

The problem is that the increased density is happening anyway. It isn't that if we build more housing, more people will come, which will bring more people in an exponential cycle. The reality is that tech workers are coming anyway, and paying whatever is required of them to live in SF. They aren't being stopped by high rents, because high as they are, they can afford them. However, they are raising prices for people that can't afford it. That pushes other people out. The result is that whether we build or not, tech workers will live in the city. Building more won't bring more of them. The only question is whether other people can live there too.

Tempest1981 11y ago
Similarly, I used to think that terrible traffic would discourage growth. Not really... people's tolerance is surprisingly high.

deleted 11y ago

[deleted]

natrius 11y ago

This is just wrong. Every reputable economist I've come across disagrees with what you're saying. As with climate change, if we ignore experts, we will needlessly careen toward disaster. Conservative economists like Edward Glaeser have long opposed restrictive zoning[1]. President Obama’s Chief Economist sees that “income inequality across cities remains entrenched and may even be exacerbated” as a result of restrictive zoning[2]. According to Nobel laureate and New York Times columnist Paul Krugman, “this is an issue on which you don’t have to be a conservative to believe that we have too much regulation.”[3] [1] http://www.city-journal.org/2008/18_3_houston.html http://www.city-journal.org/2008/18_3_houston.html [2] https://m.whitehouse.gov/sites/default/files/page/files/20151120_barriers_shared_growth_land_use_regulation_and_economic_rents.pdf https://m.whitehouse.gov/sites/default/files/page/files/2015... [3] http://www.nytimes.com/2015/11/30/opinion/inequality-and-the-city.html http://www.nytimes.com/2015/11/30/opinion/inequality-and-the...