Why the West was downzoned

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In 1890, most continental European cities allowed between five and ten storeys to be built anywhere. In the British Empire and the United States, the authorities generally imposed no height limits at all. Detailed fire safety rules had existed for centuries, but development control systems were otherwise highly permissive.

Over the following half century, these liberties disappeared in nearly all Western countries. I call this process ‘the Great Downzoning’.1 The Great Downzoning is the main cause of the housing shortages that afflict the great cities of the West today, with baleful consequences for health, family formation, the environment, and economic growth. One study found that loosening these restrictions in just five major American cities would increase the country’s GDP by 25 percent. The Downzoning is one of the most profound and important events in modern economic history.

The Great Downzoning happened during a period in which anti-density views were widespread among planners, officials, and educated people generally. Most people thought that urban density was unhealthy and dysfunctional, and supported government efforts to reduce it. It is natural to assume that this was why the Downzoning happened. Although there is surprisingly little literature on the Great Downzoning, historians who do discuss it often implicitly take this view, seeing it as of a piece with other anti-density measures taken by municipal governments across the West.

While there is undoubtedly some truth in this explanation, the evidence for it is surprisingly ambiguous. The Downzoning was extremely pervasive in existing suburbs, where it tended to raise property values by prohibiting kinds of development that were seen as undesirable. But in other contexts, it proved much harder to apply anti-density rules. In some European countries, ferocious battles were fought over whether municipal authorities should restrict the density of greenfield development. Doing so tended to reduce land values, prompting fervent resistance by rural landowners, who were generally successful in thwarting the proposed reforms. In the late twentieth century, planners and governments reversed their views on density, and became notionally committed to densification as a public policy objective. But they have had very limited success in reforming rules on suburban densification.

The general pattern is that the Great Downzoning was driven by interests more than by ideology. The Downzoning happened where it served the ...