MSU Agricultural, Food, and Resource Economics
Considerable theoretical and empirical debate has addressed the effects of minimum lot size zoning regulations on the development of land. The direction of this relationship certainly has relevance for policy. Previous studies have used econometric techniques to estimate this relationship. This paper uses a land use share multiple regression model in which the dependent variable is the natural logarithm of the ratio of acres developed from 1990-2000 to acres not developed over the same time period. It builds on previous studies by using a weighted average minimum lot size variable rather than a simple dummy variable and by explicitly considering the change in developed land area in the dependent variable. The study area is Oakland County, Michigan, a suburb of Detroit that is experiencing significant suburban development. Results show that there is a quadratic relationship between average minimum lot size and land development. At first, development declines with minimum lot size, but at a diminishing rate. Then, at approximately 5.15 acres (224,330 square feet), development begins to increase with minimum lot size at an increasing rate.