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PLAIN ECONOMIC SENSE
For release after Oct. 26, 1998
Column 352
What is Urban Sprawl and What Causes it?
By Mark A. Edelman
Extension Public Policy Economist
Iowa State University Extension to Communities
Different people have different definitions of sprawl. To some people, sprawl is any expansion of the traditional city boundaries or urbanized areas. To other people, sprawl is residential development in agricultural, forest or open-space areas. To other people sprawl is the spread out, skipped-over development that characterizes the non-central city metropolitan areas and non-metropolitan areas of the nation. To others, sprawl is one- or two-story single-family residential developments on lots ranging in size from one-third to one acre, that often is accompanied by strip commercial and industrial development.
According to one national expert, sprawl has occurred in almost every county of the United States, although it occurs in significant amounts in only about one-quarter of the nation's 3,000 counties. Most counties that contain significant sprawl have it in the form of low-density residential development that encroaches in rural and undeveloped areas. Some counties are characterized by nonresidential sprawl, commercial and industrial development. So, is it a good thing or bad thing?
On one hand, we hear arguments that sprawl is wasteful, reduces our agricultural capacity and is aesthetically displeasing. On the other hand, we lament the consequences of a weak economy. Less concern over sprawl is expressed during economic downturns of the 1980s. Rapid growth occurs when the economy is strong. Job growth requires workers. Workers want to live in places that enhance their perceived quality of life. More often than not, sprawl is a consequence of a strong economy in the context of the consumer preferences, development markets, property rights and community zoning policy.
Recently at the National Public Policy Education Conference. Dr. Robert Burchell, distinguished professor from Rutgers University, talked about urban sprawl. He is one of the nation's foremost experts on urban growth and land use policy. From his perspective, sprawl occurs, in part, because local government policy often encourages this form of development through zoning and subdivision ordinances -- which in turn often reflect the desires of the citizens.
Sprawl development is often favored by citizens because -- among other things -- it reduces congestion; it accommodates use of the automobile; it distances new development from the fiscal and social problems of older core areas; it establishes new, more viable and balanced economic bases; it fosters neighborhoods where housing will appreciate in value; it fosters neighborhoods where schools provide both education and preferred environments for socialization of youth; and property taxes to pay for local government and school district operating expenses often are lower than in locations that are closer in.
According to Burchell, sprawl has been so well accepted by the public that the highest rated locations for both residential and nonresidential development are increasingly farther out rather than closer in, and more rather than less segregated by type of land use.
Gated communities, farmettes, research parks, law offices, medical groups, mega hardware and home improvement stores, theatrical and comedy clubs, new and used car lots, and restaurants all seek peripheral locations in pursuit of their markets. The unique aspect of all of this development is that few businesses have ever failed because their decisions to select locations farther out were in the wrong direction. Occasionally, a retailer or a residential development has gone under because an interstate exit was not developed as planned, but rarely has an economic entity failed because it was developed too far out.
The bottom line for development is the bottom line for most economic decisions. The reason sprawl occurs is that an abundance of open space land is available, it is the least expensive option relative to other development alternatives and it is easy to assemble.
A recent experience in Boone causes me to agree with Burchell's perspective on the economics driving sprawl. Boone was willing to provide significant redevelopment incentives of between $400,000 to $800,000 to acquire and demolish existing buildings and residences in order to redevelop and retain an anchor business downtown. However, the business decided that it was still less expensive and more profitable to build on bare farmland at the edge of town.
If sprawl is so desirable, why should citizens be concerned or be interested in looking at alternative land-use policy strategies? For some of the answers look for my next column.
Edelman is a professor of economics and an extension public policy specialist at Iowa State University.
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