The housing affordability issue has become a debate between those who believe the solution is to impose more density on cities and those who believe the solution is to eliminate urban-growth boundaries and let people live at the densities they prefer. An op-ed in yesterday’s The Hill endorses the latter view.
Cities exist because people benefit from having resources and jobs in close proximity. But the benefits of that close proximity have decline in the past century with increasing transportation and telecommunications speeds. Nevertheless, many density advocates point to Harvard urban economist Edward Glaeser, who argues that face-to-face contacts are always more valuable than audio or video communications and so there continues to be a need for dense cities like New York. This is supposedly especially true in the finance industry, where New York excels.
If that were true, however, then why are so many finance industry jobs moving out of New York? In the 1990s, 30 percent of all jobs in the securities industry were in New York; today it is less than 20 percent. As Joel Kotkin recently noted, most of those jobs are moving to low-density sunbelt cities. Of course, face-to-face communications are still possible in cities even if they have only 3,000 people per square mile instead of the 70,000 found in Manhattan. Continue reading
