Transforming Under Growth Pressure: Grassroots Sprawl or Top Down and Smart

At the turn of the millennium, it was decided that Luxembourg should target four percent economic growth in order to best sustain existing quality of life standards. This target has largely been met as Luxembourg’s growth, which was mainly driven by the financial industry and a non-resident labour force, has averaged around five percent annually. Emerging out of a quasi-rural and industrial landscape, Luxembourg has come under the considerable growth pressures associated with a tertiary economy. It is thus facing particular challenges with respect to sustainable development. As a result, Luxembourg planning officials formulated spatially integrative sustainable development guidelines that postulate a polycentric growth model while targeting sufficient provision of housing, preventing sprawl, preserving green spaces, densifying growth poles, and enhancing public transportation. This research examines these strategies that are designed to manage growth and compares it with existing local land use practices. The small size of the Grand Duchy and narrow functional relationships between the capital city and the rest of the country justify treating the whole country as an integrated city region. The absence of a regional administrative level implies direct and strong policy dependencies between the national political and administrative levels. In this paper, particular attention is given to national policy mechanisms and their translation and implementation at the local level. The analysis reveals a number of challenges particularly with respect to enforcement and interpretation related to existing power relationships and different development visions adopted by the municipalities. Observations of the organization and capital flows of retail and commerce, housing and real estate development patterns, and the governance patterns that structure both illustrate how national smart growth policies of integrated smart growth can turn into grassroots sprawl or a governance of dispersal