Urban sprawl
February 26th, 2010
I have to credit my lovely wife for this theory, who discovered it by experience with her own employees.
Urban sprawl is caused by wage-and-hour regulation.
Most places have regulations requiring overtime pay (in the US, the usual rule is 1.5x wages past 40 hours/week).
Employers usually can’t afford overtime wages, so most employees can’t earn more by working longer hours. But many employees would rather work and earn more.
So, instead of working more hours, they spend those hours commuting from the suburbs, where housing is cheaper than in the city. Commuting from the suburbs is a way of “working” to get a larger disposable income that isn’t regulated.
I’m willing to bet that the growth of urban sprawl closely tracks the introduction of wage-and-hour regulations.
Regulations are like squeezing a balloon – what goes in where you squeeze comes out somewhere else. When you force people to do what you want, they tend to find other ways to get what they want.
February 27th, 2010 at 3:13 pm
That would suggest that people whose jobs pay overtime are more likely to live closer to their work than those whose jobs don’t. Which would jibe with the stereotype of white-collar workers living in the suburbs while blue-collar workers live in the city.
Think we could get a $10 million government grant to do a study? I’m sure it would stimulate the economy.