Category Economics

How Should We Interpret Jane Jacobs?

Jane Jacobs

At first blush, the enterprise of interpreting the Jane Jacobs’ work might seem like one best left to the proud and peculiar few, or to put it less charitably, those of us with nothing better to do. Yet the forces of history militate against this apathy: Jane Jacobs has emerged as quite possibly the most important figure in North American urban planning in the second half of the twentieth century. Her work is now taught in every urban theory and urban planning program worth its weight in ESRI access codes. She is responsible for introducing hundreds of thousands of people to planning and urbanism (including this author) and continues to shape how many of us think about cities. In one of my more popular blog posts here on Market Urbanism—and in a forthcoming book chapter—I argue that we should interpret Jane Jacobs as a spontaneous order theorist in the tradition of Adam Smith, Michael Polanyi, and F.A. Hayek. Built into her work is a profound appreciation of the importance of local knowledge, decentralized planning, and the spontaneous orders that structure urban life. Needless to say, this is not the prevailing interpretation of the importance and meaning of Jacobs’ work. Two very different alternative interpretations prevail. In this post, I argue that both interpretations are mistaken. Jane Jacobs, Form-Based Coder Many have taken Jacobs’ particular critiques of conventional U.S. zoning, often referred to as “Euclidean zoning,” as motivating a new form of zoning that takes into account her observations on design. In contrast to the mandates of Euclidean zoning, which proscribes land-use segregation and low densities, Jacobs celebrated mixtures of land uses and urban densities. Jacobs spends large sections of Death and Life discussing in detail particular urban designs that she sees as essential to fostering urban life. Much of “Part One” focuses on […]

Ch. 1 What is a City?: Cities cannot be efficient

Before we can correct what we think is wrong with a city, we need an appropriate standard of what is right. That standard of rightness in turn depends on our understanding how the thing we are trying to fix is supposed to work. In this regard I’m afraid neither standard macroeconomics nor microeconomics is much help at all. In traditional macroeconomics, too much important detail is lost in its pre-occupation with aggregates and averages. For example, standard macroeconomic theory treats capital as homogeneous, and so makes no distinction between a hammer and a harbor, except that a harbor may be the equivalent of many, many hammers. Such an approach is too blunt an instrument for getting to the level of detail needed to appreciate the complex time-structure of capital of an economy, let alone to tell us what would be necessary to promote that structure (Lachmann 1978).  Jacobs expressed antipathy toward macroeconomics. Macro-economics—large-scale economics—is the branch of learning entrusted with the theory and practice of understanding and fostering national and international economies. It is a shambles. Its undoing was the good fortune of having been believed in and acted upon in a big way (Jacobs 1984: 6-7) Earlier in this Chapter we saw that, unlike a living city, a nation-state is not a natural unit of economic analysis. In Jacobs’s words: Nations are political and military entities, and so are blocs of nations. But it doesn’t necessarily follow from this that they are also the basic, salient entities of economic life or that they are particularly useful for probing the mysteries of economic structure, the reasons for rise and decline of wealth. Indeed, the failure of national governments and blocs of nations to force economic life to do their bidding suggests some sort of essential irrelevance (Jacobs 1984: 31-32). The […]

Cities are not man-made things

[In this space I’ll be posting quotes, ideas, and excerpts relating to a book I’m writing (thus far untitled), which I might describe as “What I have learned from the economic and social theory of Jane Jacobs.”  My hope is to get thoughtful, informed feedback that will be useful in shaping the book.] Architects and planners refer to something called the “built environment” by which they usually mean things such as city streets and pathways and the grids made up by them, buildings of various kinds, plazas, the infrastructure of water and energy inflow and outflow, parks and recreation areas, unbuilt open spaces. Although parts of each of these urban elements were consciously constructed, usually by a team of individuals, the way that they fit together, except in the case of mega- and giga-projects, are not the result of a deliberate plan. Buildings in a particular location, for example, – offices, schools, residences, retail, malls, entertainment, places of worship, research facilities – are of different vintages, constructed by different people for different purposes at different times with different techniques, historical contexts, and sensibilities. But the way they all more-or-less complement one another, their “fit,” is an emergent, unplanned phenomenon. I will refer to these elements collectively as the “built framework,” where the word “built” should not in all cases imply deliberate design. What goes on within the built framework can also be planned or unplanned There are, of course, the activities for which a particular element is intended (most recently, that is, because spaces can have multiple uses over time). A gas station, what we might call a “specialized space,” is primarily for pumping gas, not for seeing a football game, which you do at a stadium. But there are other activities that take place in or are facilitated by a given element, […]

Why another book about cities?

city books

The starting point for Jacobs’s analysis and the focus of much of her thought is the city, its nature and significance. There are plenty of books out there that in some way celebrate cities.  Many describe cities as engines of economic development, wellsprings of art and culture, and incubators of ideas religious, social, and scientific.  But few go very far in explaining why and how all that usually happens in a city.  Fewer still view the urban processes as expressions of “emergence,” or what some social theorists describe using the related term “spontaneous order.”  That is the perspective of this book and its main contribution: To look closely at what makes a city a spontaneous order and an engine of innovation, and to trace the analytical and policy consequences of viewing it this way. Jane Jacobs is one of those exceptions, indeed an outstanding one.  In fact, she is probably the first to carefully examine, not only the nature and significance of cities, but to distill realistic principles that govern urban systems and to analyze the mechanisms of economic change that follow from those principles. Her analysis of the relation between the design of public space and social interaction offer insights that complement, and often exceed, those of Max Weber, Henri Pirenne, Georg Simmel (pdf), Kevin Lynch, and others. Her work also has deep connections with modern social theorists such as F.A. Hayek, Elinor Ostrom, Mark Granovetter, and Geoffrey West. But she was not the first to develop conceptual tools congenial to understanding urban processes as emergent, spontaneous orders.  In fact they have largely been available for decades in the field of economics, although few professional economists, including urban economists, have fully appreciated the urban origins of many of their standard concepts and tools of analysis. Indeed, there is a […]

Intro to Culture of Congestion

Welcome to the first post in Culture of Congestion! I’ll be posting quotes, ideas, and short essays relating to a book I’m writing, which I might describe as “What I have learned from the economic and social theory of Jane Jacobs.”  My hope is to get thoughtful, informed feedback that will be useful in shaping the book.  – Sandy Ikeda When I asked Jane Jacobs what she believed her main intellectual contribution was, she answered without hesitation, “Economic theory!”  It’s been my experience that most of those who admire Jacobs for her trenchant writings and fierce activism against heavy handed urban planning and top-down urban design find it surprising that she thought of herself at heart as an economist.  But a glance at the titles of her books makes this rather obvious: The Economy of Cities, Cities and the Wealth of Nations, and The Nature of Economies. And in her most famous book, The Death and Life of Great American Cities, she explains in intricate detail a la modern social theory what social institutions and norms enable people to discover and pursue their plans at street level, and how doing so allows the city in which they are embedded to flourish in unpredictable ways.  She understood how creative innovation – in commerce, science and technology, and culture – is central to that flourishing.  She explained, in a way that rivals or surpasses most economic theorists, how and under what conditions innovation takes place and how that tends to undermine attempts at central planning at the local level. One of my motivations for writing this book is to make Jane Jacobs, economist, better known especially to those who already rightly admire her for the other contributions she has made as a public intellectual, and to trace her criticisms of urban planning and design and of various public […]

Why Walkable Cities Enjoy More Freedom

If you happen to visit Egypt and find yourself in the famous Tahrir Square, you might be puzzled: how could this space accommodate two million protesters? In fact, the square looked different at the time of the Arab Spring, up until the new military government ringed its central part with an iron fence. A similar transformation happened with the Pearl roundabout in the capital of Bahrain where demonstrators used to gather — it was turned into a traffic junction. In my hometown, Moscow, the square where millions called for the end of Soviet rule in 1991 now houses an hideous shopping mall. For a pro-liberty movement to raise its head, Twitter is not enough: face-to-face contact is crucial. That is why when oppressive governments want to destroy civil society, they destroy public spaces. Street markets, green squares and lively parks (think of the iconic Hyde Park corner) are places where citizens meet, negotiate and slowly learn to trust each other. Joseph Stalin knew it well, hence he made sure that city dwellers had no public spaces to socialise in. The results were devastating: chronic mistrust that post-communist societies are yet to overcome. Today, 30 years after the fall of the Berlin Wall, the levels of social capital in Dresden and Leipzig are still lower than in Munich and Hamburg, which bears its economic as well as political costs. One study shows that residents living in walkable neighbourhoods exhibit at least 80% greater levels of social capital than those living in car-dependent ones. That is something to consider, given that only a half of Brits know their neighbour’s name. The economic benefits are also clear: improved walking infrastructure can increase retail sales by 30%. London has witnessed it on Oxford Street where the creation of a Tokyo-style pedestrian crossing led to a 25% increase in turnover in the adjacent stores. In the […]

Density Is How the Working Poor Outbid the Rich for Urban Land

multifamily housing

The great failing of modern land-use regulation is the failure to allow densities to naturally change over time. Let me explain. Imagine you are trying to sell a property you own in a desirable inner suburban neighborhood in your town. The lot is 4,000 square feet and hosts an old 4,000 square-foot home. There is incredible demand for housing in this area; perhaps the schools are good, or the amenities are nice, or the neighborhood sits adjacent to a major jobs center, meaning that residents can walk to work. I’ll leave the reasons to you. Who do you sell it to? You have at least two options: First, you could sell it to a wealthy individual, who would use the entire property as his home. He is willing to pay the market rate for single-family homes like this, which in this case is $300,000. Under current financing, he would likely have a monthly mortgage payment in the ballpark of $1,300. Second, you could sell it to a developer who intends to subdivide the house into four 1,000 square foot one-bedroom apartments, renting each of them at a market rate of $500 to service workers who commute to downtown. After factoring in expenses, her annual net operating income would be around $20,160. Assuming a multifamily cap rate of 6.0.%, this means that she could pay up to $336,000 for your property. Based on this analysis, who do you sell it to? The answer is obvious: you will sell it to the multifamily developer who will subdivide and rent out the house, not necessarily because you’re a bleeding heart urbanist, but in order to maximize your earnings. As rents in the area rise, the pressure to sell to a buyer who would densify the property will only grow. The prospective mansion buyer […]

The Rent is Too High and the Commute is Too Long: We Need Market Urbanism

Why is the rent so damn high? And why does it take hours to commute from cheap, plentiful housing to modern economy jobs? If you are living in a big city in America, you likely face this problem. And it isn’t just an American problem: From Ireland to New Zealand to The Philippines, the rent/commuting crisis is hitting the 21st century hard, right in the big cities where most of the economic growth is coming from, and where most of the jobs are. Meanwhile, in the economically blighted regions of America, everything seems to be falling apart, with lead in the tap water, crumbling roads, and municipal bankruptcy for thousands of towns and cities a very real possibility. But it doesn’t have to be this way. There are a few cities that seem to have figured out how to match a futuristic tech economy with futuristic transit and housing for the masses. And there are many small towns around the world that don’t face insurmountable backlogs of infrastructure repairs. What are they doing different? Why is the price per square foot for living space in Tokyo a third of what it is in Boston or San Francisco?  Both cities have similar incomes and geographic constraints. Why is it an enormous scandal in Japan when trains leave a few seconds off schedule, while in America it is normal for your bus or train to be an hour late or never show up at all? Chalking this up to cultural differences is an easy explanation, and may have some weight, but I submit that the underlying laws of human economics do not vary based on culture, and there is much that we can learn from looking abroad. For Americans, the story begins in the nineteenth century when most of the country’s infrastructure […]