Bill Testa explores the history of high gas prices and suburban migration.
…In a recent study, Joseph Cortright offers evidence that shifts toward more compact cities are already underway, as households eschew housing on the urban fringe where commuting distances are long. Indeed, in large metropolitan areas like Chicago, housing prices in closer-in neighborhoods have been holding up relatively well over the past year. The era of urban sprawl has been pronounced dead, with households and employers expected to favor greater density as a way to economize on energy-related travel costs.
However, the contrast between expectations in the 1970s and what actually came to pass may give us pause in assessing today’s predictions. Just the opposite took place in the 1970s era. Central cities of large metropolitan areas, especially in the Northeast and Midwest, experienced their worst decade of the century. Population tended to flee to the suburbs, especially middle and upper middle income residents. The apparent reasons for flight included rising crime, school desegregation, and the near-completion of an interstate highway system that funneled homeowners to cheap and abundant housing on the perimeter…
It’s easy to assume that higher gas prices automatically yield a shift in living patterns, but the reality is more complicated. For one thing, the meanings of “urban” and “rural” have changed. In particular, metropolitan areas like Chicago and Milwaukee are now composed of a single true downtown plus several suburban minidowntowns. People may indeed move closer to downtown to reduce communiting time, but not necessarily to the downtown. Overall sprawl may not change at all in that case.
Second, what matters is the relative price of driving. Gas prices may go up in a dramatic and noticeable way, but salaries in an area may go up even more. The net result could be that driving becomes less important to household budgets and location decisions in that area.
We’ll have to wait and see how all of the factors play out.
