The Insatiable Demand for Land: Urban Change and Land (Re-) Development

Abstract

This paper describes the main forces behind the “insatiable demand for land.” It shows that this demand is not only the product of population growth and higher incomes leading households to demand large backyards. It also shows how the movement of workers and economic activity across areas plays a fundamental role. More specifically, firm creation and destruction and the movement of workers lead to a phenomenon of “slash-and-burn development.” Such slash-and-burn development is possibly subject to a number of market failures. However, attempts to drastically curb development may have effects much beyond those typically considered in land-use analysis.