Why The Government Is Not The Answer To Urban Planning

Via SchiffGold.com,

City planning is a task that is often seen as a unique realm of governmental necessity.

The existence of externalities means that the market could create extremely sub optimal outcomes when creating a city.

For example, a house with a messy front yard hurts everyone, but the people in this house might have little incentive to clean up. A network of streets might not benefit its creator as much as the people who use it. While there are certainly some examples where the government intervening can be very helpful for most people, there are also many circumstances where government intervention is actually the key to a city’s demise.

The importance of city planning is so great that it truly cannot be the decision of any one individual.

Governmental city planning has many wins, but even more losses, not as a result of any specific government’s choices, but as a result of the institution’s inherent inability to capture information. 

The first problem with governmental urban planning is that they cannot effectively gather information on what people want.

It would be uncommon for them to even run surveys on individual preferences. Beyond this, preferences themselves fluctuate. Predicting people’s preferences far into the future is almost impossible, and even more impossible for cash-strapped governments. People often cannot predict even their own preferences, so even if this information was to be gathered, there is no guarantee it would remain true. This harms city planning practically in the example of deciding how walkable a city will be versus how much it will allow people to live in the suburbs and commute in. The usefulness of a city is derived from  how well it fulfills the preferences of its residents. People who try to make city planning a science don’t account for the fact that the exact same city would be a success or failure, depending entirely on the people who live within it. 

The second problem with government driven urban planning is that there is an extremely poorly-functioning feedback loop.

Governments obscure their understanding of their own successes because they typically benchmark against other cities. They can only see their actions in conjunction with so many other environmental factors that it is difficult to disentangle the results of their policy and what would have happened anyways. The problem with benchmarking against other cities is that the inherently different environmental, social and legislative conditions of each city mean that a success for one city would truly be a failure for another city. However, there is too much pressure for urban planners to compare between fundamentally different cities. Sometimes a city will view itself as a failure and take drastic remedial action, but not realize that they have actually improved greatly from their previous state and would have kept proving with even less drastic action. Like anything in the study of humans, it is almost impossible to isolate factors within city planning. The relative success of a given district within a city might arise from 30 different subjective factors but also allow urban planners to falsely attribute the success to either outcome variables, or insignificant elements of the urban tapestry.

A final limitation of governmental urban planning is the lackluster incentive structure.

People are voted into office based on a wide variety of factors, but most often the most divisive policy points. Except for a few extreme cities, urban planning and infrastructure are not often in this list of big ticket items. While it directly affects people’s lives, they are more likely to attribute their sense of unhappiness on their commute to any policy other than the policies that actually created their roads and city structure. People like to think that things can be changed after one electoral cycle, but the problems that towns and cities face require years of complicated work in the same direction. Elected officials have the strongest incentives to satisfy the people’s desires, but the people who do most of the city planning lack this incentive as strongly. Urban planners are much more concerned with pleasing the bureaucrats and politicians who hired them then they do in developing an understanding of what the people of the city want. They are incentivized to present ideas that have worked in other places and are theoretically agreed-upon in general which leads them to creating spaces that work well in many places but not incredibly well in any one place.  It is easy to tell when something has been created in this way because there are specific types of public transportation and urban spaces that seem to have been given the greenlight in the prestige-driven industry of urban planning.