Zoning regulations harm the economy and the environment

Originally justified as a proactive means of preventing nuisances, zoning has become a significant threat to liberty, economic growth, and environmental protection. These restrictions have driven up the cost of housing astronomically, discouraging people from moving to cities with greater economic opportunities and encouraging sprawl. Libertarians have long opposed zoning as an unjustified restriction on individual liberty and private property rights. But opposition has been slowly spreading to the left and the right.

Recently, the left-leaning Brookings Institution published a report by Harvard economist Ed Glaeser showing that zoning restrictions have harmed economic growth and reduced migration within the United States. Glaeser explains the scope of the problem:

Starting in the 1960s, a property rights revolution occurred in the U.S. Backed by environmentalist rhetoric in the suburbs and preservationist priorities in the cities, American localities increasingly restricted the rights of property owners to build. We changed from a country in which landowners had relatively unfettered freedom to add density to a country in which veto rights over new projects are shared by a dizzying array of abutters and stakeholders. Consequently, we now build far less in the most successful, best educated parts of the country, and housing prices in these areas are far higher than construction costs or prices elsewhere.

Zoning regulations have caused housing prices to skyrocket in many areas, especially metro areas with higher incomes and economic growth. This disproportionately harms those with lower and middle incomes. Higher housing prices have priced people out of these communities, making it more difficult for people to migrate from economically depressed areas. Mobility within the United States has hit a record low, as fewer people are chasing greater productivity to new cities.

The harms from inefficient zoning regulations are not limited to the economy. Zoning also causes environmental harm. By preventing greater housing density, it encourages sprawl by forcing people to move further and further away from the city center to find affordable housing. That reduces the amount of land that’s available for other uses or conservation, increases commuting-related pollution, and increases runoff.

Zoning  will likely exacerbate the harms of climate change. Those harms are a function of the local impacts of climate change and the difficulty of mitigating them. Zoning makes mitigation much more difficult in two ways: (1) it requires costly and time-consuming permitting to protect existing structures and may forbid adaptation entirely; and (2) it makes it more expensive and difficult for people to move to escape climate change’s impacts.

People may already be moving to hedge against these risks. A recent Scientific American story reports that population growth in Miami is shifting from the coastline towards higher ground. This has led current residents to decry gentrification as a threat to their community, raising the specter that they’ll use zoning to frustrate this population shift.

That will only exacerbate the harms to the victims of climate change. Government should instead seek to mitigate them, by reducing barriers to migration and building in less vulnerable areas.