Country overview US: Evaluating the Role of Local Government
Dr. Jan Whittington (University of Washington, Seattle)
In this lecture we take an in-depth look at a few prominent examples of the ways in which markets and the institutional rules that govern markets result in the spatial outcomes we see today in the United States, in land use and transportation. The first example is Silicon Valley, as a case of path dependent investments that agglomerated over time, reinforced by an institutional environment that favored the protection of ideas as private property and the freedom of entrepreneurial development. We then contrast the case of Silicon Valley with Seattle, where Amazon’s expansion and vast market presence have significant local impact. While these cases illustrate market forces, the next case highlights the role of government in establishing rules with spatial consequences. We introduce the institutions of zoning and street design standards, examining their origins, composition, and consequences for the spatial arrangement of cities. To bring the theory back in, we explain how transaction cost economics can be used to examine the implications of changing these institutions over time, with a glimpse at the complexity of the market for land in the United States. Having introduced the institutional economics of transportation, we then conclude by discussing two critical issues in this sector: the combination of artificial intelligence (automation) with transportation, and the need to mitigate climate change.