Voting, Risk Aversion, and the Nimby Syndrome: A Comment on Robert Nelson's Privatizing the Neighborhood
![handle is hein.journals/gmlr7 and id is 891 raw text is: 1999]
VOTING, RISK AVERSION, AND THE NIMBY SYNDROME:
A COMMENT ON ROBERT NELSON'S
PRIVATIZING THE NEIGHBORHOOD
William A. Fischer
I. THE NIMBY PROBLEM IS SOLVED BY LIMITS ON VOTING
American land-use controls present a problem for efficient utilization
of land in metropolitan areas. As a rural community is transformed into an
exurban and then suburban community by development, new residents
eventually take over the political machinery. Unlike the older residents,
they are not much interested in local economic development for jobs or for
business-related reasons. What they are interested in is the value of their
major asset, their homes.
Owner-occupied housing is, for the vast majority of residents, the
largest asset that they will ever own. Homeowners believe that the value of
this huge asset will be affected by the deterioration of neighborhood and
municipal-wide conditions. Scores of economic capitalization studies show
that they are rational in this belief.' As a result, homeowners are exqui-
sitely interested in any neighborhood change or changes in municipal taxes
and services that will affect the value of their homes. This interest may
explain why homeowners are far more apt to vote in municipal elections
than renters.2
It also accounts for the NIMBY (not in my back yard) syndrome.
NIMBYs are mostly nearby homeowners who object to further develop-
ment within their community. The development may be homes just like the
ones in which they live, but the neighbors oppose it because they fear that
greater density will adversely affect local road congestion, neighborhood
character, crime, taxes and public services.
NIMBYs show up at the zoning and planning board reviews, to which
almost all developers of more-than-minor subdivisions must submit. If
* Professor of Economics, Dartmouth College; e-mail: Bill.Fischel@DartmouthEdu. This
article is based on a paper prepared for a conference on Freedom of Contract in Property Law, De-
cember 5-7, 1997, sponsored by the Donner Foundation and the Law and Economics Center of the
George Mason University School of Law.
I See WILLIAM A. FISCHEL, Do GRowTH CoNTRoLs MATrER? 15 (1990); Mingche M. U & H.
James Brown, Micro.Neighborhood Externalities and Hedonic Housing Prices, 56 LAND ECON. 125,
125-41 (1980).
2 See JAMES M. BURNS ET AL., STATE AND LOCAL POLMCS: GOVERNMENT BY THE PEOPLE
211 (7th ed. 1993); Peter H. Rossi & Eleanor Weber, The Social Benefits of Homeownership, 7
HOUSING POL'Y DEBATE 1, 23 (1996); Pamela H. Moomau & Rebecca Morton, Revealed Preferences
for Property Taxes: An Empirical Study of Perceived Tax Incidence, 74 REV. ECON. & STAT. 176, 179
(1992).](ViewImageLocal?handle=hein.journals/gmlr7&div=38&collection=journals&method=preview&ext=.png&size=3)
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Voting, Risk Aversion, and the Nimby Syndrome: A Comment on Robert Nelson's Privatizing the Neighborhood
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