Declining suburbs: cause or symptom?

Last week I wrote about why I don’t think Chris Leinberger is correct in his assessment that the American suburb drove the financial crisis. I noted that increases in unemployment–there was some discussion about whether that increase in unemployment was particularly severe or not–revealed the fragility of credit markets, and thus the dominoes began to fall.

So I’m less convinced that declining suburbs are the reason for the continued lag in US employment after the crash and subsequent recession. This article from the FT explains why: Pay gap a $740bn threat to the US economy. Three points: a) new technology is replacing labor at a much more rapid pace; b) greater labor supply in general has depressed wages (there was similar discussion of wage decline after women entered the workforce in large numbers); and investment simply isn’t moving despite high profit-taking. That is, companies are cutting labor due to a) and b) and yet still posting large profits. Still, investment isn’t moving. In theory, investment should be available to help those laid off back to work in new endeavors, but if investment isn’t moving, it can’t do that. It smells of a saving trap not unlike Japan’s. Trickle-down theories only work if people who have the means to trickle do trickle rather than keeping the money in the old oak chest.

The saving trap problems adds fuel to the Keynesian fire. Sure, gummint spending may be less productive than private sector spending, but it (in the past) hasn’t had the same incentives that investors have faced and has (prior to our current problems) been able to take on risk that private investors eschew. Sparks are meant to work in both directions.

In the end, the long-term factors pushing down real wage growth whittle away the wealth available to people who would consume housing, both urban and suburban. Once easy credit dries up, it’s not hard to see why geographic locations where new homeowners have typically been able to buy, like suburbs, show decline.

I like the reasoning. No data to prove anything though.

Rolf Pendall on upstate sprawl and a commentary on urban social science

In answer to my questions the other day about Aaron Renn’s idea that sprawl is driving to fiscal crisis for cities like Buffalo, Rolf Pendall from the Urban Land Institute sent along a link to a 2003 report he penned for Brookings: Sprawl Without Growth.

You can download the entire report in addition to reading the summary of the findings. Among the culprits are those I suggested in the post–greater individual incentives to sprawl–and some I didn’t think of (and should have) like high tax differentials between cities and outlying areas.

Pendall also grouched at me for suggesting that there is only direction of causation, arguing that urban systems are complex, adaptive systems–not mechanistic ones.

So what does it mean for systems to be complex and adaptive? Changes in any part of the system can prompt individuals to change their behavior and vice versa–that is, there isn’t one direction of causation, and multiple factors can cause the same change, or the same change can cause different subsidiary changes, and changes can either reinforce other factors of change (as I suspect is the case with fiscal crisis urban outmigration), or there can be multiple, overlapping, and conflicting factors.

I would argue that I didn’t suggest in my original post that there is only one direction of causation, but that’s clearly what he read, so let’s throw down over it. I did suggest, and I still do, that Renn has attributed causation to the wrong factor when suggesting that cities are broke due to sprawl. (Nonetheless, Renn’s probably right in that sprawl is probably reinforcing other factors that are driving central city fiscal crises even if it isn’t causing it per se.)

Since Rolf is one of those people I look up to, the comment struck a cord because the complex, adaptive system argument is everywhere. And it is both a) probably absolutely 100 percent correct and b) an excuse for extremely poor scholarship among urban planners.

As an urban planner in a school dominated by economists, I live in the whipsaw between the complex, adaptive argument and the mechanistic argument.

The complex, adaptive systems argument indeed allows us to see the many many nuances and factors in play.

It as often as not leads us to one descriptive, noninformative, blithering case history after another, where what’s deemed causal by the end comes down to whatever the planning scholar wants. Like “we need more transit, more urban growth boundaries, more of my pet policies because those all clearly worked here.” If, at any point, somebody raises a counter example of how, say, more transit accomplished very little, the response can always be “But these are complex, adaptive systems and you can’t generalize.” Well, you just generalized from your case. “But my case is exemplary.”

If I had a dime for every time an urban planner has given this talk in front of my economist and quantitive political science colleagues to be met with eye rolling and general disdain, I would be looking for a house in Beverly Hills now.

The other side of the whipsaw are the urban economists, who hope to find more generalizable knowledge and, thus, more mechanistic causal relationships.

As often as not, they have carefully controlled for every variable under the sun. They have found the cleverest instrumental variable known to mankind. They have used a marvelous fixed effect that has captured (in a general way) the nuanced differences from one administrative jurisdiction to another. They have thus produced a model that shows, definitively, that time costs matter when people select travel modes. No shit.

And my students wonder why I’m bitchy.

Both planners and economists are going to object to my characterization–and these are two, reductive extremes–but I stick by it. I hear this argument every damn day in some form. The economists use it to try to claim they are better than the planners, the planners use it to argue they are better than the economists.

As usual, I’m a person with a foot in both worlds with divided loyalties.

My preference, though I doubt there’s much merit, is to accept the belief that the world is complex, we can’t model everything (but neither can we describe everything–ask a historian; choices have to made about what is in and out of our memories) and that our knowledge of the phenomenon in any situation is miserably partial. Nonetheless, it’s worth making the effort to try to capture the complexities and exigencies using history on the one hand, and to try to look for the dominant levers to affect change on the other hand (seeking generalizability).

I have no big rationale for believing as I do, other than giving up on the idea that the truth is out there would put me out of job. The endgame of the first extreme is that nothing is truly generalizable; everything is happening for the first time and the only time, as everything depends on context. The end game of the second extreme is dancing on the head of a pin. Both are a lot work for remarkably little payoff in terms of knowledge.

Sprawl and decline, and reversing the directions of causation

Aaron Renn, the Urbanphile, has a post up arguing that cities are broke because of sprawl. Oh boy. Go read.

I have trouble believing that Buffalo is going broke because of sprawl. It’s such an extreme case of industry loss over the last 40 years that it’s hard for me to use it as an exemplar for any urban phenomenon other than “a place where the weather makes Dr. Schweitzer want her mommy.”

So what’s my point about the direction of causation? In a place like Buffalo, where populations began to decline due to employment loss and demographic shifts, land prices go down, and so larger lots become comparatively more affordable to the people there who remain a) employed and b) in the housing market. My friend who teaches in Rochester, for example, routinely sends me the absolutely beautiful homes she thinks about buying.

This is what you can buy in the Fillmore area of Buffalo for $115,000. SWEET CRACKER SANDWICH that’s a big honking house on a big honking parcel of land.

Voila Capture37

For comparison, I looked for comparable 3,800 square foot houses anywhere in the Bay Area, and it’s just not happening. I don’t know that market as well as I know LA, so looking there, I find this little darling (holy buckets) in Sherman Oaks:

Voila Capture38

Ok, apples and oranges, and all that, but still: $115K in relatively suburban Buffalo versus $1.5 million in suburban Los Angeles. Yes, wages are different, but I am pretty sure I don’t make 15 times as much as a university professor at SUNY Buffalo.

And in Buffalo, your suburban life really carries few transport-housing costs trades, either, because as population goes down, your travel costs go down (no congestion of any real magnitude). Fuel costs, yes, the costs that Buffalo winters take out of vehicles, yes, but time costs–low. The incentives for individuals in these places to consume land is nicely set, and the city/regional government is not in a strong position to implement growth controls when they are not growing.

I suspect that Detroit is rather like Buffalo’s story; decades of industry decline and outsourcing leave very few reasons for young people to stay there, or for immigrants to move there. Other than it’s cheap.

But Renn’s claim about Chicago is hard to reconcile. The Chicago metro area grew, and Chicago is a region with multiple urban centers (like most thriving metros).

The city of Chicago has been a darling amongst planners for doing everything right for past decade: they cleaned up their downtown, you can’t turn around without hitting a pedestrian walkway, public art smacks you in the eyeball every time you look up from your iphone, pocket parks galore, and they have invested heavily in every part of their transit. If that’s a pro-sprawl, laissez-faire central city government, I’m a size 2 (hint: I ain’t). So what’s up with that? Chicago usually ranks pretty low or moderate on sprawl indexes as well. So either those policies aren’t working, which is bad news, or something else is going on. According to one of the commenters, Chicago’s policy and planning methods haven’t had enough “teeth.” What teeth, exactly, can the city use to try to starve it suburbs? And how smart would that be? Most New Urbanist and Smart Growth tools are voluntary, incentive and amenity-based strategies. They are not widely implemented with teeth. How do you lay down an urban growth boundary when your city is surrounded by other cities? If you think regional governance is the answer, you have never ever attended a meeting at the South Coast Association of Governments.

The bottom line is that investments in infrastructure on the fringe of declining regions make little sense–that’s Renn’s major point, and of course he’s right–but I can’t credit his connection between being broke and sprawl. There’s probably a connection between tax aversion and suburbanization, but I don’t think Chicago, Detroit, and Buffalo are suffering from the same urban malaise, unless that malaise is “too damn much snow for the human mind to fathom.”

If sprawl is the reason we’re broke, why are states having trouble financially? The Federal government? It’s not like they pay for water infrastructure to serve irresponsible, bloodsucking suburbanites.

Matt Kahn and housing in liberal cities

Well, while I was brushing my teeth, Matt Kahn went out and published another very interesting paper:

Kahn, M E. 2010. Do liberal cities limit new housing development? Evidence from California. Journal of Urban Economicsdoi:10.1016/j.jue.2010.10.001.

The finding? Cities with a higher score on liberal voting also permit less housing.

It’s less clear what this finding reflects. Kahn brings up Berkeley’s attempts at growth control–which in some ways make no sense from an anti-sprawl perspective because already developed areas should be taking more housing, not less, to direct growth away from fringe areas. As my former colleague Jesse Richardson says, Smart Growth is not birth control, and if urban areas are to grow not on the fringe than existing areas have to take their lumps.

Kahn’s manuscript may be an indicator that California cities are not taking their lumps.

So why is this a problem? It is more evidence that cities can cherrypick Smart Growth and New Urbanist principles to take what they like and leave what they do not: the line from the New Urbanism as that we could, with more density, get plenty of housing–some of it affordable–if we simply stopped allowing suburbs and we deconstructed single-use, residential zoning. Unfortunately, the application appears to be to shifting housing to other jurisdictions or restricting housing permits overall–a far miss from the sort of densification that the New Urbanist and Smart Growth advocates envisioned.

This is, of course, only if the connection to liberal voting and housing permits occurs via this increased willingness to take on growth controls. It could be something else, as Kahn doesn’t have regulatory structure.

The Sprawl/No Sprawl-Productivity Connection (?!)

From Papers in Regional Science, a new paper shows the connection between lost labor productivity and sprawl. From the abstract:

This paper draws on urban agglomeration theories to empirically investigate the relationship between the economic performance of US metropolitan areas and their respective amounts of sprawl. To measure urban sprawl, we construct a distinctive measure that captures the distribution of population density and land-use within metropolitan areas. Using both ordinary least squares (OLS) and instrumental variables (IVs) approaches, we find that higher levels of urban sprawl are negatively associated with average labour productivity. This pattern holds even within given industries or within given occupational classifications.

link: Urban sprawl and productivity: Evidence from US metropolitan areas – Fallah – 2010 – Papers in Regional Science – Wiley Online Library

Here’s their sprawl measure:

It’s a relative measure: L% is the percentage of the regional population living in block groups with population densities lower than the US median, H % is the percentage of the metropolitan area living in block groups above the US median. The number is going to range between 0 and 1, with higher numbers meaning greater sprawl.

So the least sprawled regions wind up being the big metro areas, with some surprises:

Miami-Fort Lauderdale-Pompano-Beach, FL — 0.3405
Stockton (!!!) — 0.3394
CA Chicago-Naperville-Joliet, IL-IN-WI — 0.3329
El Paso, TX — 0.3315
San Diego-Carlsbad-San Marcos, CA –0.3176
Honolulu, HI — 0.3170
New Orleans-Metairie-Kenner, LA — 0.3104
Laredo, TX — 0.2620
New York-Northern New Jersey-Long-Island, NY-NJ-PA — 0.2479
San Francisco-Oakland-Fremont, CA — 0.2313
San Jose-Sunnyvale-Santa Clara, CA — 0.2058
Los Angeles-Long Beach-Santa Ana, CA–0.1630

According to their measure, Los Angeles is the least sprawled metro region in the country, beating out New York and San Francisco.

This creates problems. Because Los Angeles IS what people worry about when they worry about sprawl.

The most sprawled:

Barnstable Town, MA–0.9497
Sebastian-Vero Beach, FL –0.9232
Punta Gorda, FL –0.9041
Panama City-Lynn Haven, FL –0.8868
Spartanburg, SC –0.8767
Pensacola-Ferry Pass-Brent, FL –0.8722
Burlington, NC–0.8657
Fayetteville, NC — 0.8560
Lakeland, FL — 0.8538
Chattanooga, TN-GA — 0.8478
Hickory-Lenoir-Morganton, NC — 0.8404
Fort Walton Beach-Crestview-Destin, FL — 0.8402

They find that the connection to labor productivity comes from the share of population who has a college degree. That is, the self-selection of college graduates in the denser regions. It’s hard telling what these findings really show; their data year is 1990, and the sprawl measure is blunt.

They play with different sprawl measures, and their findings are pretty robust.

So if they are right, what does this mean? I’m a wee bit worried about this finding, actually. It suggests that the connection between sprawl and labor productivity derives from residential self-selection into particular metropolitan regions–the big ones–rather than from anything related to physical aspects of urban form. They aren’t, for example, capturing any real inherent disadvantages from commutes on labor productivity, or loss of connectivity in the exchange of ideas. Instead, it’s a matter of correlation rather than causation: high-productivity laborers like urban amenities–Richard Florida’s arguments.

If that’s the case, the labor productivity nexus can change a lot if those taste preferences change.

Go read the full article:

Fallah, Belal, Mark Partridge, and M. Rose Olfert. “Urban Sprawl and Productivity:Evidence From US Metropolitan Areas.” Papers in Regional Science (2010).

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LA and California History viewed through Perry Mason and Paul Drake’s Hair

Ok, where to begin?

Perry Mason, for those who don’t know, is a fictional defense attorney practicing in Los Angeles, created by the mystery writer Earle Stanley Gardner, shown here. If you’ve never picked up a Perry Mason novel, I highly recommend.

Perry Mason was the basis of the long-running tv series–it ran from 1957 to 1966!–featuring Raymond Burr (one of my favorite actors) as Mason and the extremely lovely Barbara Hale as his secretary/confidante Della Street (shown below) . The show featured an excellent ensemble cast, including William Hopper as Paul Drake, Mason’s go-to private investigator, and undeservedly obscure character actor William Talman as the always-foiled district attorney Hamilton Burger.

So what lessons can we learn about urban and state history from the Perry Mason universe? A bunch.

First off, Raymond Burr’s lifelong commitment with his partner Robert Benevides is a object lesson for why California’s Proposition 8 banning same-sex marriage is a civil rights problem, no matter what you personally believe about the morality of homosexuality. Burr met Benevides in 1960 and together they built Burr’s acting career and a vineyard. Partners, no matter what sex they are, often sacrifice for the partnership, and theirs was no exception; Benevides gave up acting to help Burr manage his increasingly successful career. Together, they were philanthropists and buisinessmen. That is shared work and economic value.

After Burr’s death in 1993, Burr’s niece has challenged Benevides controlling Burr’s estate, particularly their vineyard, which he still runs. She may a point, for all I know, but it should caution us. Marriage isn’t just about a bedroom; it’s a set of property agreements, and under no accepted measure of justice should Benevides be threatened with the loss of what he built with Burr over the course of nearly 40 years. In some states, he would be in more jeopardy than he was in California. Everybody should have equal protection under the law, and that includes rights to property. The easiest way for partners to take care of each others’ property in legal agreements is marriage and pre-nuptials. .

Secondly, William Hopper himself was the son of high-profile Hollywood gossip Hedda Hopper, who is one of the early chroniclers of Hollywood history.

Hopper’s character, Paul Drake, is one of the most interesting in the series. Hypermasculinized as a player, his smooth blonde pompadour and his Thunderbirds were a California male ideal. Throughout the series, he drove Thunderbirds*: 1957, 1958, 1961, 1963, 1964, and 1965, including the convertible models. I think its hard for my car-hating students to understand just how unbelievably cool these cars were, shown below.


1965 convertible

There is no disputing that these are two of the most beautiful cars ever produced, and no, car culture isn’t just about waste. In more innocent times, they manifested the beautiful material craftmanship of human imagination and vision.

Finally, when you watch Perry Mason, occasionally Paul has to take the Thunderbird out “all the way to the North Hollywood.” The glimpse you get from Mason in the late 1950s is a North Hollywood full of farms–way suburban fringe. It was really far out of town, you know. Now it has a subway station:

*Mason also drove some pretty cool cars, including the Ford Fairlane.

Suing Pleasanton Over Sprawl

One of my unbelievably smart undergraduates, Alexene Farol, noted via Facebook the other day that the state of California (Jerry Brown, AG) is suing the city of Pleasanton over a 13 year-old rule that caps housing units at 29,000 for the city. It currently has 27,000.

As I said to Alexene when she raised the point, I have no idea how Pleasanton got away with this in the first place–it strikes me as both a clumsy and obvious attempt at exclusionary zoning. But I’m not an attorney, so we consulted Jesse Richardson at Virginia Tech.

Sprawl is not a housing-unit problem, per se, or a “too many people” problem. It’s a land consumption problem. Regulating the first, as Pleasanton has done, simply disallows housing unit growth in the city and thus (because as Jesse says: “growth control is not birth control”), residential growth occurs elsewhere, increasing commutes.

I don’t generally echo the New Urbanist party line that Jerry Brown does. There is plenty within their vision that doesn’t hold up, either empirically or theoretically, such as the notion that rail investment and compact development increases land values near stations (true, via more amenities) and we get more affordable housing, too (probably not, except for a short-term increase in housing unit supply, which even at “dense” US densities (i.e., not particularly dense, even when we call it density) evaporates vis-a-vis metropolitan growth). Householders aren’t in the habit of considering affordability when they know they have one of a restricted number of units while demand is increasing.

However, in this case…I can’t imagine Pleasanton getting away with doing this.