More on street-by-street zoning

A number of commentators on my recent column have suggested that allowing street-by-street zoning would lead to more restrictionist outcomes than under the status quo.  It might well be true that the improvement will be zero, but if new construction already is constrained at zero perhaps matters won’t get much worse.  I see two reasons, however, for believing a number of streets would be willing to make bold or at least modest experiments in the direction of more development.

First, if you are considering more development for a larger area, say half of a county, you might worry that traffic problems will become much worse and thus the veto rights will prevail.  In contrast, if a street of say thirty homes decides to add three homes more, they probably are less worried about the net traffic impact of that very small decision (unless running kids over in that very street is the main worry).  Of course, if every street makes a matching decision, aggregate traffic still will go up a lot.  But in essence, by breaking the problem down street by street, the traffic veto motives are weakened in prisoner’s dilemma-like fashion.

Of course you might think all that extra traffic and development is a bad thing, but that is a different and indeed opposite critique from fearing excess restrictionism.

Second, a lot of streets just aren’t up to making these decisions across a long series of legally complex variables.  I can well imagine that generalized holding companies spring up to represent individual streets in their negotiations with the municipality/county/developer — whatever.  Imagine negotiating companies funded by the developers, whether directly or indirectly, which in turn fund additional amenities for the street whenever new revenue is generated by a micro-local decision.  Coase!  “Well…if you will accept these five new homes, the developer will donate some money to park maintenance and a scholarship at the K-12 school.”  It might not even amount to illegal bribery.

I don’t think street-by-street zoning is “the answer” to NIMBY, rather it is one idea worth experimenting with on a limited basis.  If it works well, it can spread.  If you start trying it in already NIMBY-dysfunctional areas, I just don’t see the downside.


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