Should the government intervene in urban growth?
16 February 2010
The 'compact town' with dense building in the town and lots of green space between towns is the result of a deliberate government policy. However, this policy has made living in the town less attractive. Dutch researcher Jasper Dekkers concludes that policy makers have achieved their objectives but with too little consideration for secondary effects.
The so-called 'Green Heart' policy, the Buffer zone policy – green corridors of no less than four kilometres wide between major urban agglomerations – and the compact town policy are effective according to policy evaluations. Yet is such a spatial policy for the Randstad area of the Netherlands ideal from an economic welfare perspective? Might it not be wiser to develop a more park-like landscape in which the rural areas become more interwoven with the urban areas and acquire a more recreational function? This is the question posed by Dekkers following his analysis of the relationship between market prices on the land market, the lack of space and spatial planning policy.
House prices are falling due to various developments
One effect of the current spatial policy is that houses are being built closer together. This is at the expense of the green element in the town. Dekkers’ research has shown that houses with a green area nearby are considered to be more attractive and people are prepared to pay more for these. However, there is no unequivocal effect on the price of houses with large open spaces at a distance. Furthermore, noise nuisance always has a negative effect on house prices; with the prevailing threshold values air traffic has the greatest influence on house prices followed by railway traffic and road traffic.
Difference in land prices
The strict distinction between urban and rural areas leads to a large difference in the market price for land in the urban and rural submarkets. This works in the favour of speculation, particularly in the urban fringe. From an economic perspective the behaviour of speculators can be defended, yet from a social perspective the large profits of private parties often lead to a lot of consternation. Speculation increases land prices. Policy makers and the public need to consider the extent to which the government must intervene in this imperfect land market, says Dekkers.
Agricultural objective left trailing behind
Dekkers concludes that the Midden-Delfland reconstruction act, a unique policy construction, indeed led to the protection of the open space and the development of the recreational function. The third objective of the policy in this area – improving the agricultural conditions for cattle in particular – has not been achieved, however.
Dekkers' study demonstrates that combining methods and techniques from Geo-ICT and spatial econometrics has a wide range of added value for the policy and policy-supporting process.
The doctoral research Externalities, land use planning and urban expansion was carried out at the Faculty of Economics and Business Administration of VU University Amsterdam under the auspices of the NWO programme Social Scientific Research into Nature and the Environment (GaMON).
..............................
For further information please contact:
- Dr Jasper Dekkers, jdekkers@feweb.vu.nl
- The doctoral thesis was defended on 19 February 2010
- Supervisors: Prof. P. Rietveld, Prof. H.J. Scholten and Prof. A. van den Brink
