Category Archives: Economics

Why Are Mom and Pop Stores So Scarce?

By Dom Nozzi

May 17, 2017

A friend of mine recently complained that the city we live in (Boulder CO) is “planning ANOTHER bank for the Pearl St. Mall! When is enough enough,” she asked?

She went on to claim that there are “15 empty store fronts but that is because of landlord greed.”

“When,” she wondered, “will the city decide that we need to encourage mom and pop stores over banks and large chains that have no vested interest in the city?”

The City of Boulder, I explained to her, is not planning to add another bank to the Mall. A bank president is planning to do that.

Banks, I said, are common in such low-density places (such as American pedestrian malls) that are unable to attract a large number of customers, as are jewelers. If you were a landlord along the Mall, I told my friend, I suspect that you would be aggressively seeking the rents sought by the existing landlords, as I believe you share the same values as those landlords: making money rather than losing money. And I suspect you would not consider yourself “greedy” for wanting to avoid losing money.

Throughout its history, and up to this very moment, Boulder (like a great many cities in America) has desired mom and pop stores along the Mall. But there is almost nothing a city can do to encourage such stores for two primary reasons: (1) The rent is very high along the Mall, which makes it financially impossible for a mom and pop store to afford to be there; and (2) The density of residential and commercial development in the vicinity of the Mall is far too low to attract enough customers to make it feasible for a mom and pop store to survive.

Mom and pop stores only occur when rents are relatively low, when there are a high number of customers living and working in the vicinity (such as in Brussels, Antwerp, Bern, Siena, and many other compact cities), or both.

The Law of Large Numbers, when applied to cities, shows that as a city grows its population, and does so relatively compactly, worker productivity increases, innovation increases, mom and pop stores grow in number, cultural diversity grows, and the range of restaurants and grocery store items grows. The Law partly is driven by synergy. UntitledSynergy occurs when larger numbers of people congregate and work together, and the whole becomes greater than the sum of its parts. Low densities, by isolating creatives, destroys diversity, innovation, smaller scales and the number of choices available.

Boulder is an interesting case because it shows both effects: a very low density, yet relatively high levels of innovation due to the large number of brilliant and creative people who have settled in Boulder — largely due to the high quality of life. If Boulder became much more compact and dense, I believe levels of innovation, diversity, productivity, mom and pop stores, and productivity would grow substantially (the city would also be far more walkable and bikeable).

Boulder’s decades of NIMBYS fighting tooth and nail to lower densities (and the very high quality of life) in the city are the primary reason why mom and pop stores are rare on the Mall and big chains/banks/jewelers are common.

When is enough NIMBYism enough?

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Filed under Economics, Politics, Urban Design

Nudging Not Commanding

 

By Dom Nozzi

January 14, 2017

I recently participated in a Facebook discussion regarding the huge environmental impact of air travel.

Many people rightly have serious concerns about the enormous environmental impacts of flying. Many are so concerned that they advocate a strict prohibition on such travel.

Since reading the book Nudge, by Richard Thaler (2009), however, I have become a much stronger advocate of “nudging” people towards socially desirable objectives. Nudging retains choice for those who must have that choice, but makes it more difficult or costly to opt for socially undesirable options (such as less obligatory behavior including recreational travel).

Thaler cites the example of elevator and stairs location: the elevator should be lesopen-silver-elevators visible and hidden away when you walk into a front door. The stairs, which are more socially desirable than an elevator, should be right at the front door.

Command economies (think prohibition laws in the Soviet Union) ignore the fact that it is necessary to give some people the choice to do certain things, and the Soviet example shows that commanding instead of nudging is not particularly sustainable or compatible with human nature and human needs.

I say these things as someone with an environmental science degree, and as someone who has lived life with a very, very small ecological footprint (never owned a car, no kids, low-meat diet, etc.).

It HAS been very tempting to me to outlaw things that are environmentally harmful. But I have come to learn that as painful as it might be, we must allow for choices.

We just need to make less desirable choices less easy.

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Filed under Economics, Environment, Politics, Transportation

Managing Parking at the Trailhead Development in Boulder, Colorado

By Dom Nozzi

January 1, 2014

There is a new neighborhood being built at the western side of Boulder (just east of the Sanitas Trail System) called “Trailhead.”

For Trailhead to be a great neighborhood, it needs to incorporate some or all of the following parking-related ideas. As far as I know, sadly, these design features are not being incorporated.

Parking meters should be installed on Trailhead streets to reduce spillover parking to nearby neighborhoods, ensure that sufficient parking is available in Trailhead, and provide revenue for enhancements and upkeep of street and sidewalk infrastructure in Trailhead. I think that spillover parking from Trailhead will be almost unnoticeable in this neighborhood. If there IS significant spillover, parking permits or parking meters (that homeowners can be exempt from paying) would solve the issue.

I don’t like the idea that the Trailhead developer has to pay – up front – to provide “free” parking to residents of the development. Such parking requirements convert a cost drivers should pay at the end of their trips (the cost of parking) into one developers must pay at the start of their projects (and then pass on to homebuyers). Having developers pay up front is also problematic because it is unfair to those in the development who have relatively few or no cars. The price of parking should be unbundled from the price of housing at Trailhead so that a buyer has the option of paying less for a home by not opting to have parking provided.

I don’t at all like the idea of having the developer of Trailhead have to install a LOT more asphalt on the development site to provide “affordable housing for cars.” I much prefer the provision of less parking at Trailhead so that there is less asphalt for storing cars at Trailhead.

Studies throughout the nation over the past several decades show that the more parking provided at a development like Trailhead, the more cars will be owned per household, asphaltwhich increases the miles driven per household. I prefer less cars owned per household, and less per household miles driven.

I prefer more demand for transit by Boulder residents. Providing more parking at Trailhead reduces transit demand by those living at Trailhead.

I support community-wide eco-passes (a pass that allows the pass-holder to ride the bus system in the region for free), but only when Boulder properly manages parking in the city. Providing more parking at Trailhead makes community-wide eco-passes less likely, because there will be less demand for such passes.

I prefer compact, walkable, charming design at Trailhead. The more parking that Trailhead provides, the less walkable, compact and charming it will be.

Providing more parking at Trailhead makes that development more suburban. Making it more suburban means it will fit in less with the walkable character of the adjacent, historic Mapleton Hill neighborhood.

 

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Filed under Economics, Sprawl, Suburbia, Urban Design

Transportation Drives Land Use Despite What Transportation Planners Tell Us

 

By Dom Nozzi

January 5, 2000

Nearly all transportation planners say they are widening the roads just to follow the land-use decisions that already have been made by the community.

Nonsense.

While almost all transportation planners make this claim, it is an old, discredited, conventional wisdom that is so conventional that even most non-transportation people believe it. Of course, it is quite handy for the transportation people because they can escape guilt when the strip commercial and sprawl happen. “Not my fault. It was those planners and elected officials who changed the land use.”

Seems sensible until you look closer and find out how the market brings unbelievable and relentless pressure to change the designations when we widen the roads and the intersections, and expand the parking.

If we are incredibly courageous and true to our principles, we might be able to delay the re-zoning caused by those enlargements for a few years. But that just means that because the road carries so much high speed, high volume traffic, it is no longer feasible to keep in street without on street parkingresidential because the quality of life is so miserable (as a result, the residential building eventually is abandoned, or is downgraded from owner-occupied to rental), or it is no longer rational to keep it as a farm because you can make millions by selling it for a shopping center.

Also, all the conditions that people dislike about the city — whether real or perceived — such as noise, crime, etc., can be more easily fled if the newly widened roads allow you to get to work each day in a reasonable period of time, even if you live in an outlying area. The ultimate result is that as we add capacity to streets, we set in motion a pattern of sprawl and strip, we wipe out farms, and we accelerate the decline of in-town areas.

And I’m convinced that the driving force is our roads, NOT our inability to hold the line on our land use and zoning maps.

Hard to believe, but before WWII, planners were god-like. Here is an apropos comment I found on the new urbanist listserve a few days ago:

“…[A] colleague suggested in passing that planners and architects abandoned urban design as such in the late 1940s and retreated to their respected spheres of influence – policy and buildings, respectively, leaving the ground to the public works engineers.  Note, the Amer. Soc. of Civil Engineers (ASCE) has a division devoted to “urban design” (urban highways, streets, water and sewer and drainage systems).  The American Institute of Architects does not.”

So yes, let’s return to the golden age of cities and planning before we ruin ourselves in our insane efforts to make cars happy…

 

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Filed under Economics, Sprawl, Suburbia, Transportation, Urban Design

Is It a Good Idea to Build Walkable Developments in Greenfields?

And Will a Strong Plan and Strong Elected Officials Be Sufficient?

By Dom Nozzi

August 2, 2000

I think as a culture, we need to make sprawling, poorly-located projects and happy cars the Great Satan, the Number One Moral Evil.

And we need to figure out what conditions will result in such a change.

Frankly, I think one of them is building traditional, walkable neighborhood developments (TNDs) in greenfields. Admittedly a compromise, but it is one of the few market-based leverage points we have. I think that once most of us become convinced that our future development can ONLY be TND, contiguous, properly located development rules will inherently follow. As it stands now, only a few pointy-headed intellectuals understand seasideaerialthat important need, because we’ve poured trillions into building big highways and thereby locking ourselves in to having a huge majority that wants to flee the city for the cabin in the woods.

It seems to me that broadly speaking, we have two realistic tools for reversing unsustainable sprawl:

 

  1. Use TNDs as a leverage and educational tool in greenfields; or
  2. Stop widening roads and starting road dieting a great many roadways.

In the near term, I think #1 is much more likely. The outrage is that #1 means the loss of important natural areas (not to mention fragmentation), but it is almost certainly the price we must pay in the near term for committing the sin of pouring trillions into highways. I do not think it is feasible for us to find the political will and cultural values shift in the near term to fight for:

  1. TNDs, and only contiguous to an existing town.

Yes, polls encouragingly show that the majority across the US oppose sprawl. But we know that there have been huge majorities that support environmental conservation for DECADES. Of course, this has merely been lip service. It is so easy to tell a pollster what you think is best, based on what our culture says is moral, but then not walk the walk in our own lives.

It is a concept known as “Social Desirability Bias,” where people dishonestly tell pollsters how they think or behave not because they actually think or behave in such a way, but because they do not want to admit to the pollster that their thoughts or behaviors are unethical.

We need to be careful and not kid ourselves about how successful we can be in the near term to discourage development in undesirably remote places. Boulder CO, for example, typically elects Council members who are strongly in favor of tightly controlled growth and development. And history shows that south Florida somewhat similarly fought hard for environmental conservation and against sprawl.

The results are not pretty.

Reaction to such elected officials in Boulder sometimes results in the election of folks relatively supportive of unrestrained development, and even with a majority of Council members supporting strong growth management, such an aggressive stance tends to result in poorly designed sprawl occurring in towns around Boulder that are not affected by Boulder’s regulations. Most of that sprawl houses people who commute into Boulder. And we know what has been done in south Florida.

I wish we could successfully manage new development with nothing more than political will and well-crafted plans. But if the market, HEAVILY DISTORTED BY GOVERNMENT SUBSIDIES, calls for the opposite, we will get what the market wants, regardless of having even the most impressive elected officials and plans.

I often get into a shouting match with my Gainesville, Florida planning department supervisors, who still fail to realize that the long-range comprehensive plan merely records what has already been decided or what is already on the ground. This is the case despite Gainesville currently having a majority of “liberal” (albeit spineless) commissioners for a number of years. I’m hoping to have a minor effect with the transportation plan, but my early call to have “no net increase in road capacity” has already been chopped out by my supervisors.

The comprehensive plan is nearly irrelevant with regard to development that occurs, even if it calls strongly for no sprawl and is backed by five no-growthers on the city commission. What matters is the market. We must change that, with the few tools we have, if we want to have an impact. End public subsidies that fuel sprawl, stop widening roads, stop requiring a huge amount of parking, stop making mixed use and slow and narrow streets and granny flats illegal, encourage admirable model TNDs, etc.

More Thoughts on the Above Topics

We are nowhere near putting a halt to sprawling, remote, car dependent development. Given that political reality, I’m much happier with a TND in remote locations than a conventional sprawl project in such a location.

We certainly need to determine what it will take to muster the political will to effectively stop sprawl. Mostly, we need to stop widening roads, start putting a huge number of roads on a diet, start requiring pedestrian-friendly and auto-inconvenient mixed use projects via development regulations, and modify market preferences for cabins in the woods. How can we do that? I’m hoping that part of the solution will be to get some of the sprawl subdivisions (which is 99.9% of what is built) to be TNDs instead, so they can stand as visible INDICTMENTS of auto-dependent shlock. We need more envy on the part of the upper classes (who tend to be opinion-leaders and power-brokers) for new urbanism, and an excellent way to do that is with greenfield TNDs.

We need greens to stop fighting like mad — and burning themselves out in the process — to stop an infill project in order to save a few trees. They will win a few battles, but lose the war as they turn a blind eye – comparatively speaking — to the eco-rape happening at a much larger, more environmentally costly scale, in our greenfields. Too often, it seems like greens fight hard against TNDs, yet barely raise a peep when it is an auto-friendly project in a remote location.

It is fortunate that Sierra Club is finally starting to realize that a key lynchpin on saving our remaining, important natural areas is to address transportation. Transportation drives what happens with our land use (and, indirectly, our conservation). If we fail to stop our single-minded efforts to make cars happy, our natural areas are doomed to the sprawl steamroller even if every single elected official in the US supports strong growth management.

I agree that time is of the essence. We must therefore work quickly to reverse our car dependency trends, since, more than anything else, such trends are wiping out our greenfields with a HUGE number of new  subdivisions every week. I don’t think it is healthy or sustainable for us to keep fighting against greenfield developments. There are too many battles, and not enough of us. And the market forces — mainly due to the huge roads we’ve built — are too overwhelming.

As for concerns about such things as habitat fragmentation, it is a clear threat. And the number one cause? Not greenfield TNDs. The big culprit is roads and auto dependence.

I agree that requiring only contiguous development will buy us time. But our car culture makes that rather unlikely, since the market pressure to leapfrog is huge.

I like the jujitsu concept here. I’m often trying to figure out a way to use the power of the enemy against it. We need to get the market to help us. Remove subsidies. Build admirable models. Tax what we dislike…

I guess our ultimate dilemma is that stopping the road-builders remains a MONSTROUS undertaking. Perhaps as difficult as finding the will to simply stop sprawl development through, say, an urban growth boundary. I’m convinced one of our best hopes is that it soon becomes unaffordable for us to continue widening.

Then we need traffic congestion to do its many positive things.

 

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Filed under Economics, Environment, Politics, Sprawl, Suburbia, Transportation, Urban Design

Fixing Transportation Problems With Pricing in Boulder Colorado

 

By Dom Nozzi

February 21, 2010

How can we improve transportation in Boulder, Colorado? Here are some of my ideas.

I prefer the efficiency of pricing as a lever to achieve GHG emission objectives, rather than land use policies.

I am convinced that we need to address the enormous problem of travel externalities.

Most all of the roads and parking in the Boulder area are either un-priced or underpriced. That means we have an enormous number of low-value car trips in the metro area. Since the costs of motorized travel is largely (exclusively?) externalized, we are experiencing an excessive number of motorized trips.

We need to institute and then calibrate road and parking pricing more comprehensively. We still have excessive GHG emissions, so those prices need to be ratcheted up until motorized SOV travel is reduced sufficiently. Revenue from the pricing needs to be why-tolls-are-neededexclusively dedicated to non-SOV travel (transit, bicycle, pedestrian), and perhaps toward assisting local governments to pay for the work needed to prepare new policies and regulations.

I recognize that pricing can have negative social impacts on other worthy community objectives, such as the need to allow lower-income groups to affordably live in the area, or commute to lower-pay jobs from remote locations (where false economies are assumed – but which often do not pan out when added travel costs are factored in). I therefore support travel pricing rebates or travel subsidies when lower-income people can provide sufficient evidence that they are low-income. Part of this affordable housing issue is the need to have the City provide adequate quantities of housing that is situated in mixed-use, relatively compact neighborhoods, so that the household can own less motor vehicles and devote more of the household income to housing instead of a second, third or fourth car.

By the way, while living in Richmond VA, I noticed that while the city has way too much free parking in the metro area, there are quite admirable road pricing strategies (via toll booths found on a number of metro roads and highways). I say this not because Richmond is an example of a city that has used pricing tactics to avoid sprawl (indeed, it has sprawled more than most any city in the US over the past few decades), but because the city shows that such road pricing is politically and financially feasible.

 

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Filed under Economics, Transportation

Road Diet Opposition

Right Sizing Road Diet Opposition

By Dom Nozzi

August 22, 2015

“Road diets,” where travel lanes on a street are removed so that there are, say, three lanes rather than four, are profoundly beneficial when applied to nearly countless streets throughout the nation. See here and here and here for blogs I have written that describe some of these benefits.

An important obstacle to such a beneficial reform of a street, however, is that for over a century, Americans have been single-mindedly obsessed with pampering and subsidizing motorists.

When we combine that with the fact that on a daily basis nearly all of us travel inside an enormous metal box, we inevitably experience the frustration of slow downs from OTHER enormous metal boxes driven at the same time by our fellow citizens on a rather skimpy 40 people without blk textnumber of streets. Due to the huge size of our cars, even when there are only a handful of other drivers, we will find others “in our way.”

Due to pampering and our relative lack of being slowed down when we are walking, motorists seem to feel a larger sense of entitlement than any other group I know of.

And a frustration I’ve had to deal with in my 34 years in transportation planning is that unlike almost any other profession, nearly all people feel they are experts in “solving” transport problems, even if they have zero academic or professional credentials.

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Filed under Economics, Road Diet, Transportation