Place

Economics, and Transportation, and Planning, Oh My!

Steven E. Polzin, Ph.D., writes in a PLANetizen op-ed that the planning profession has not noticed economics.

The existing literature, including literature on the cost of sprawl, is focused on the land use traits of density, mix of uses, contiguousness, and urban design. An analysis of the implications on travel of evolving economic phenomenon and business models is under-represented.

The "economic phenomenon" mentioned is the rise of big box stores as the most efficient retail model. Would they be the most efficient if the public were not absorbing indirect transportation and parking costs? One of Wal-Mart's innovations was the redesign of the loading docks in their distribution centers: improved logistics reduced costs. Their ability to profit does not entirely result from their bargaining leverage. I suspect there are similiar innovations possible with small stores.

He raises the point that the larger stores have longer hours and large selections as well as lower prices. The former do not necessarily follow from the size of the retail establishment. Wendy's keeps the drive-thru open until 01:00. If they want to sell anything, retail establishments should be open when their customers are available to buy. In a typical suburb, the residents are miles away from local retail during the day, and only have opportunity to shop after 19:00. It thus makes sense to extend the hours past 17:00, and to open on the Sabbath. And while the big box can hold more inventory, Mrs. Green's and PayLess have wider selections of certain goods.

The big box is economically viable because we must drive everywhere. Once we're leave the car, we like to walk, and will avoid returning to the confines of our vehicle. But, yes, it behooves one to consider economics.

4:50:47 PM # Google It!
categories: Place