Review of Agricultural Economics—Volume 29, Number 3—Pages 572–579 Cure for Urban Sprawl: Measuring the Ratio of Marginal Implicit Prices of Density-to-Lot-Size∗

State and local governments have long wrestled with sprawl, leading to theimplementation of “smart growth ” policies. The key principle underpinning smart growth policy is compact development to preserve open space, farmland, and critical ecological habitat. Many communities with commitments to controlling sprawl through smart growth policy are struggling with implementation. Their struggle emanates from lack of understanding about the causes of sprawl. Smart growth analysts increasingly emphasize higher-density housing as a possible cure for urban sprawl. Compact housing development may be a challenge because research suggests increasing preferences for lower density housing (Skaburskis; Gordon and Richardson). Higher-density housing could be achieved if communities could replicate the factors that increase the desirability of low-density housings. Burchell et al. suggest that typical single-family housing lots could be reduced in size by 20 to 25 % if other qualities associated with a neighborhood were maintained. One popular strategy for the coexistence of compact lots and desirable neighborhood qualities is the implementation of a conservation subdivision ordinance. By clustering streets and homes closer together, developers of conservation subdivisions are able to set aside larger portions of the community, anywhere from 20 to 70%, as preserved open space (Arendt). As smart growt