| Abstract: |
Recent economic analyses emphasize that designated open-space increases the
rents on neighboring residential land, and likewise, the probability of
undeveloped land converting to residential uses. This paper addresses a
different question: What is the effect of local open space conservation on the
rate of growth in the density of existing residential land? The analysis is
relevant for exurban development and also for remote lakeshore development,
where shoreline development density can rapidly increase over time and
open-space policies are often advocated as a way to protect ecosystems by
reducing development. A discrete choice econometric model of lakeshore
development is estimated with a unique parcel-level spatial-temporal dataset,
using maximum simulated likelihood to account for i) the panel structure of
the data, ii) unobserved spatial heterogeneity, and iii) sample selection
resulting from correlated unobservables. Results indicate that, contrary to
the intuition derived from the current literature, local open space
conservation policies do not increase the rate of growth in residential
development density, and some open space conservation policies may reduce the
rate of growth in residential development density. This is consistent with
land-value complementarity between local open space and parcel size.
Spatially-explicit simulations at the landscape scale examine the relative
effects of conservation policies on the time path of development. |