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IntroductionWhat do parks, forests, vacant lots, wildlife refuges, lawns, cemeteries, wetlands, golf courses, and farmland have in common? They all can be characterized as not containing urban development and therefore can be classified as “open space” areas. Open space is a term that has been adopted by many land use planners, growth management advocates, and others to refer to areas that, simply put, have an absence of development. Many different types of land uses can qualify as being open space. For example, open space may be either publicly or privately held; it can vary from a few square meters to many hundreds of square miles in area; and it can be located anywhere – in central cities, along suburban roadways, interspersed among exurban development, or as a rural landscape. From a land use management perspective, a central question is whether or not land has value as open space and if so, what characteristics determine its value. A second question that is relevant for growth management concerns the role of open space in the formation of residential and other urban land use patterns. If open space is valued by individuals and households, it may play a role in their location decisions. Households that value open space may make their residential location decision based at least partly on open space considerations. In this paper, I review some of the empirical research that has sought to identify the value of open space and the role of open space in individuals’ location decisions. Evidence from various studies shows that certain aspects of open space are valued and that open space has significantly contributed to a more scattered pattern of residential development in some exurban[1] areas of the U.S. Does Open Space Have Value?The value of land as open space refers to the value of what some may consider its “non-productive” uses. For example, a parcel of farmland clearly has productive value if it’s being used as an input to produce a food commodity. However, a parcel of farmland may also have value because it prevents development from occurring, provides a scenic view for neighbors, and provides habitat corridors for wildlife. These values arise not from the productive value of the land as an agricultural input, but rather because of the amenities that are provided by the open space. In many cases, these open space values are benefits that are enjoyed not just by the landowner, but by others as well. In the case of farmland, residents that live nearby and appreciate the lack of congestion and scenic views associated with the farmland will value the land as an open space resource. Several studies have sought to elicit the particular characteristics of open space that determine its value and measure the value in terms of “willingness-to-pay” measures. Some evidence suggests that open space is valued most for what it isn’t – i.e., for not being development. For example, based on results from focus groups of residents in Kane, McHenry, and DeKalb counties, Krieger (1999) finds that the most important aspect of open space for these residents is its role in slowing growth and reducing sprawl development. Maintaining open space is seen as a way to maintain quality of life by preventing the negative effects that these residents associate with sprawl, e.g. congestion, hectic pace of life, increased crime, and a lost sense of community. This result is borne out by contingent valuation studies used to estimate the amount people would be willing to pay to preserve land in agriculture. Halstead (1984) and Beasley, Workman and Williams (1986) estimate that households’ willingness to pay to preserve an acre of average quality farmland rose to about $150 per household from about $50 when the replacement for agriculture was hypothesized to be high density rather than low density development. The mechanism by which open space is preserved also matters. For example, Blaine, Hudkins, Daubenmiere, Sommers, and Kulikowski (1999) find that support for preservation of farmland through a purchase development rights program among residents of southern Portage County and Medina County is strong, but very sensitive to the proposed funding mechanism for the program. Other studies have considered whether the pattern of open space within the neighborhood of a house affects its property value (e.g. Bell and Bockstael, 1999; Bockstael and Bell, 1998; Garrod and Willis, 1992a; Garrod and Willis, 1992b; Geoghegan, Wainger, and Bockstael, 1997; Leggett and Bockstael, 1999). These papers explore whether, in the immediate vicinity of a housing parcel, the percent of surrounding land in each of different land use categories (agriculture, forest, low density residential, high density residential, commercial/industrial) affects housing prices. The results suggest that, all else equal, nearby open space increases the selling price of a house. However, this result varies and depends on whether the houses are in predominantly urban, suburban or rural areas, since an increase in surrounding open space may be valued highly in suburban areas, but not in rural areas. The amount of value that individuals place on open space is found to vary a great deal, depending on: (1) individuals’ income and education levels, (2) the location of the land parcel, (3) the alternative land use (i.e. the land use that the land would be in if it were not in open space), and (4) the funding mechanism used to secure open space. While studies are not wholly conclusive, they do provide evidence that open space provides valued landscape amenities for which individuals are willing to pay. Does Open Space Influence Patterns of Development?If the benefits from surrounding open space are sufficiently high, then people will place a higher value on a house that has more open space around it than a house with similar features located in a more developed neighborhood. Of course, many other features of a house and the location of a house will also matter, including the commuting distance to work and shopping, public services, and the size and quality of the house. Houses that have large amounts of open space around them tend to be further away from urban and suburban centers. When households make decisions about where to live, they make trade-offs, among other things, between the distance that they are willing to commute and the amount of open space amenities that are available to them. If households place sufficient value on open space, then they will choose to live further away from urban areas than if they only cared about accessibility to the urban area. Irwin (1998) and Irwin and Bockstael (1999) find evidence of the influence of open space on the resulting pattern of development in exurban areas. They study the evolution of scattered patterns of residential land use in a central Maryland exurban region, located within the commutersheds of Washington D.C. and Baltimore, MD. Map 1 illustrates the 1994 land use pattern in the central Maryland region. The scattered low-density residential pattern of development is evident in the exurban areas south and northwest of the D.C.-Baltimore corridor (e.g. Calvert and Charles counties). This scattered pattern of development is not explained solely by zoning or by traditional economic models of land use based on the notion that households want to minimize their transportation costs to the urban center and will choose to live as close to an urban center as possible. Map 2 illustrates the prediction of land use pattern for this central Maryland region under based on the traditional urban economic model, in which distance from Washington, D.C. and Baltimore is measured via the major roads network. Map 3 shows the pattern that would result taking current zoning conditions into consideration as well. In both cases, a fairly concentrated pattern of development is predicted, in which commercial and higher density residential land uses are located closest to Washington D.C. and Baltimore and lower density residential development located in contiguous areas around them. In comparing the actual pattern in Map 1 with the predicted patterns in Maps 2 and 3, it is evident that the notion of accessibility alone does not explain the outlying scattered pattern of low-density, residential development. The authors
test the notion that the amount of open space around a land parcel is an
important factor influencing the probability of a land parcel being converted
to a residential subdivision. To test
this hypothesis, they measure the percent of neighboring development around
each land parcel that could have been converted to residential subdivisions
within their study area between 1991-1997.
They estimate a model of land use conversion, in which the probability
of an exurban land parcel being subdivided into a residential subdivision is
influenced by (1) distance to the nearest urban center (either Washington
D.C. or Baltimore); (2) soil quality; (3) whether the parcel has public sewer/water
service; and (4) the proportion of neighboring development around the
parcel. Results show that the
influence of neighboring development on the probability of land being
converted from open space to a residential use is negative and significant. All else equal, as more and more
development occurs in the neighborhood around a land parcel in this exurban
area, the less likely it is to be developed. Or in other words, land with more
open space around it is more likely to get developed than a similar parcel of
land that has less open space around it. Irwin and Bockstael (1999) use the model’s results to predict the pattern of land converted to residential subdivisions under two different cases: (1) the case in which the positive effect of open space is ignored and (2) the case in which the positive open space effect is included. Map 4 compares the predictions for these two cases, referred to as the “restricted model” and the “full model” respectively, with the actual pattern of subdivision development. It is clear that the “full model” predicts a pattern of land use that is much more scattered and one that is much more similar to the actual pattern of development. Spatial summary statistics used to compare these patterns support this observation (see Irwin and Bockstael, 1999 for more details). The authors conclude that open space as a positive amenity has significantly contributed to the scattered pattern of residential development in their exurban study area. Whether it’s because of the lack of congestion or the scenic views, surrounding open space increases the value of a parcel as a residential location, all else equal. As residential development continues to occur in exurban areas, the pattern of development will continue to occur in a scattered fashion so long as open space areas exist and is within the commutershed of urban areas.
What are the Implications for Growth Management Policy?The irony of the finding from Irwin and Bocstael’s research is that, as more people seek to live in areas surrounded by open space, larger contiguous tracts of open space will disappear faster than otherwise would be the case. This has some interesting implications for growth management policy: Ø If local and state governments are interested in preserving larger tracts of open space, this research shows that policies aimed at encouraging more clustered development are necessary. Ø It also suggests that policies aimed only at preserving larger tracts of land, without also encouraging more clustered development, will not be sufficient to offset the tendency for scattered development in exurban areas. Ø Policies that only target open space preservation may even have perverse effects. For example, a policy that ensures the provision of open space by protecting targeted areas of farmland could actually encourage more development around the edges of the protected open space area than would otherwise occur. The reasoning is simple: if people value open space and a policy is put in place to ensure that an open space area will be preserved, then households can act with greater assurance that the land will remain in open space. All else equal, the land next to protected open space will be higher valued as a residential location and conversion is likely to occur sooner around these protected areas. To offset this tendency, policies that encourage more concentrated development in areas with existing development and infrastructure are needed in conjunction with open space and farmland protection policies. ReferencesBeasley, S. D., W. G. Workman, and N. A. Williams (1986), ‘Estimating Amenity Values of Urban Fringe Farmland: A Contingent Valuation Approach’, Growth and Change, 17, 70-78. Bell, K. and N. Bockstael (1999), ‘Applying the
Generalized Methods of Moments Approach to Spatial Problems Involving
Micro-Level Data’, Review of Economics
and Statistics, forthcoming. Blaine, T., S. Hudkins, J. Daubenmire, G. Sommers, and T. Kulikowski, “An Assessment of Residents’ Willingness to Pay for Farmland Preservation Using the Contingent Valuation Method (CVM),” 1999. Bockstael, N. and K. Bell, (1997), ‘Land Use Patterns and Water Quality: The Effect of Differential Land Management Controls’, in R. Just and S. Netanyahu (eds), International Water and Resource Economics Consortium, Conflict and Cooperation on Trans-Boundary Water Resources, Kluwer Publishing.
Garrod, G. and K. Willis (1992b), ‘The Environmental
Economic Impact of Geoghegan, J., L. Wainger, and N. E. Bockstael (1997), ‘Spatial Landscape Indices in a Hedonic Framework: An Ecological Economics Analysis Using GIS’, Ecological Economics, 23(3), 251- 64. Halstead, J. (1984), ‘Measuring the Nonmarket Value of Massachusetts Agricultural Land: A Case Study’, Journal of Northeastern Agricultural Economic Council, 13(1), 226-247. Irwin, E. Do Spatial Externalities Matter? The Role of Endogenous Interactions in the Evolution of Land Use Pattern, Ph.D. Dissertation, University of Maryland, 1998. Irwin, E. and N. E. Bockstael (1999), ‘Interacting Agents, Spatial Externalities, and the Endogenous Evolution of Land Use Pattern,’ Working Paper, November 1999. Krieger, D. “Saving Open Spaces: Public Support for Farmland Protection,” Working Paper, Center for Agriculture in the Environment, American Farmland Trust, April 1999. Leggett, C. and N. E. Bockstael (1999), ‘Evidence of the Effects of Water Quality on Residential Land Prices', Journal of Environmental Economics and Management, forthcoming. |
