What is Scarce With 3D Printing

I ended up on an interesting line of thought tonight about what exactly the world will look like with ubiquitous 3D printing. 3D printing will bring in an age of abundance, but in a very specific way.

Once the manufacturing process is made costless, the only physical costs in any object will be raw materials. These materials will still be subject to the same laws of supply and demand as they always have.

Ideas will matter more. For designed objects, the design knowhow will be in demand, while for practical objects the technical knowledge will be more important. In both cases, the actual knowledge of 3D design techniques will be needed at some stage, and in either case, they will face the exact same pressures faced by media companies today. These ideas will be easily copied, and a system will have to be arranged to allow designers, engineers, and 3D artists to be properly compensated for their efforts.

For the first time however, this model will be applied to something completely new. Media companies had established business lines, and obviously tried to preserve those in the face of the unique pressures of the digital age. The ability to completely bypass the manufacturing industry has never existed before, and therefore the incentive structure surrounding it will necessarily be entirely new.

The economics of the future will be completely built around this fact. When "copy and paste" is applied to the real world, ideas, skills, and raw materials will have to interact in an entirely new way. We'll still have physical limits, but these will be expressed as raw material limits that will be immediately apparent to everyone. Ideas are no longer tied to physical objects, and can therefore no longer be priced as a "value add" to goods as they are today. Looking at it from this angle, it seems arbitrary that ideas were ever tied to physical goods, but in the future, we will need to come up with a way to properly incentivize people to create. The dystopian version of real world copy and paste is a world where creativity dies, society finds a way to function in a sustainable way, and continues eternally in a static world of no change.
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The Past and Future of Philadelphia

Aaron Renn's recent post on Philadelphia made me think of a few of the qualities that make it so unique. The other large Northeastern cities, New York, Boston, and Washington DC, have all followed similar tragectories: seemingly permanent urban decline followed by a drastic recovery. These trends apply to Philly as well, but it would seem they have taken a different form.

Aaron explains the fabric of Philly as being a collection of small towns without a real city identity. Steve W, in one of the comments, further explains the relationship between the University of Pennsylvania and West Philadelphia. One could see this in stark contrast to the relationship Columbia and NYU have with their surrounding neighborhoods.

Alan Ehrenhalt devotes one of the chapters of The Great Inversion to Philadelphia, and explains another unique character of Philadelphia: its concentration of row house homeowners. Moreso than any other comparable city, Philadelphia is a city of families who own their own row houses. Alan describes how in our new reality of demographic inversion, this hinders large scale developers which are more successful in other cities. In Philly, a single holdout is more likely to impede the development of a large scale modern apartment building in an improving neighborhood.

Taken together these yield some interesting conclusions about Philadelphia. The established low-rise community-oriented character of Philadelphia act as a moderating force for the city. The community will serve as a stabilizing force during decades of decay, but will also prevent it from feeling the current wave of gentrification (for better or for worse.)

While I wouldn't argue that Philadelphia was a safer place to be in the 70s than New York, Boston, or DC, I'd say its trough could be more compared to Detroit. In terms of the positive change, Philadelphia is still an anomaly on the east coast. It remains the cheap option to those who want the large city urban east coast experience. Even the most expensive neighborhoods in center city are extremely affordable when you're comparing them to other large cities in the Bos-Wash corridor. Of course this also means the poorer neighborhoods of Philly are more destitute than comparable neighborhoods in other cities, so while displacement hasn't happened to the degree it has in other cities, there isn't as much in city opportunity available to people from these marginal places.
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The Real Problem With High Frequency Trading

This podcast did a great job explaining a lot of things: The origins of high frequency trading, the absurdity of financial regulation made from the point of view of a bygone era, and the absurdity of high frequency trading today. High frequency trading has (rightfully so) been under intense scrutiny since the near collapse of Knight Capital and the previous afternoon long flash crash.

High frequency trading is not bad as a concept. If the market reacts to data a day later, and you find a way to react in half a day, you have a more efficient market. You're essentially "oiling the gears" of the stock market.

The problem lies in the incentives: they're winner take all. If I come up with that improvement, I get all of the value from my information edge as the market adjusts to normalcy. And if someone jumps ahead of me to react in an hour rather than half a day, they get all of the value. There is absolutely no mechanism to stop this from devolving into a destructive arms race, which is obviously happening as HFT companies are now fighting over milliseconds, and going to extreme lengths to get that edge.

The marginal benefit of these increases in efficiency decline, but it's not reflected in the incentives. It's a good thing to take a process that normally takes a day and reduce it to an hour, but the efficiency gain in reducing this process by a millisecond is minuscule.

There should be more regulation to correct this error. Some firms should specialize in high frequency trading, but they should not be encouraged to fight over such trivial time differences. I'm not sure what sort of policy would best fit this problem, but it does need to come from a place where it addresses this exact issue.

This is only one of several problems that exist in our current financial system, but I believe it's a good example of how these problems should be approached. Instead of letting populist feelings guide thought around the regulation of the financial industry, policy makers should be looking for these misaligned incentives that are the true cause of wall street malfeasance.
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Urbanists Should Pay More Attention To The Jersey Shore

No really.

Well, I'm sure my experience of the Jersey Shore is somewhat unique. I have a friend who has family in Bradley Beach, so when I think of the Jersey shore, I think specifically of the range from Asbury Park down to Belmar, and not of Snookieland. Through a series of particularities in their development, these towns might lead to a future development path for suburban areas.

All of these towns were developed and incorporated in the late 19th century, which partially explains why the form of the area east of Main Street are very compact grids, and in some areas the architecture is more Victorian. These are also of course vacation oriented beach towns, which should lend itself more towards a compact form since there's an amenity everyone wants to  be close to (I'd love to see a study that actually explains this, it does seem to be true anecdotally!)

Throw in an NJT train with closely spaced stops, and you have an urban area that's urban for every reason except proximity to the city. I think this sort of development is cool because it stands in stark contrast to more traditional transit oriented development. Instead of looking at the suburbs and trying to retrofit a series of centers around train stops, this is more of an urban sprawl similar to what one would find in the inner city.

Because it's a beach town, cycling is of course a major mode of transportation. This definitely helps poorer residents further inland, who benefit from a more bike friendly culture and safety in numbers as a result of living close to the beach and don't have to waste money having a car.

Inner ring suburbs could particularly benefit from this sort of development, since they share the age and bones of this portion of the Jersey Shore. It's more natural to have infill development in the suburbs to have a more uniform nature, rather than concentrations near stations interspersed among more open space. Tracts of these medium density developments would be amazing places for bike culture to flourish, and would help with its current image problem of being a toy for coastal yuppie elites.

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Express Buses and SBS: An Easy Win

Noah Kazis reported on Streetsblog yesterday the reaction of the New York City council at a transportation conference to select bus service: They want more of it!

Vacca's comment was one of the more telling of the councilmembers quoted:

Vacca also called for additional efforts to speed express buses. “They get stuck in the same traffic as everybody else,” he said, leading riders to turn to their cars. “That’s exactly what we want to avoid.”

Having grown up in Vacca's district, I not only get the sentiment of this comment, but have a deeper understanding of the transportation decisions people living in these areas actually go through, and see more in this comment and its general sentiment that would (in my opinion) be dismissed too quickly as a "windshield perspective" by a blog like Streetsblog.

I agree our elected officials can do way more for public transportation in our city instead of focusing on parking issues or other ways to make it easier to drive. But it helps to understand where outer borough dwellers are coming from. If you're in the outer areas of the outer boroughs, you live at the intersection of car culture and mass transit culture, and individual people can make the choice to orient themselves either way. I would further argue that choosing auto orientation is a more insular option, which is why it lends itself to the perspective that everyone in your neighborhood drives, and is the true basis for a windshield perspective.

Unless a politician is positioning him or herself as a transportation visionary, it's easy to get caught up in viewing your outer borough neighborhood as an island from which you drive to the suburbs for most of your needs, and see a populist tinge in what you see as Manhattan-centric policies to make it harder for you to drive downtown, especially when they're not paired equally with transit benefits that your constituents will see.

Vacca's comment shows that the windshield perspective isn't an ideological, stodgy, or blind perspective. It's simply one brought on by the climate one is in. In the right climate, outer borough politicians can be pro-transit. While there have been amazing strides made in transportation infrastructure under the Bloomberg administration, a lot of these strides were achieved in such a way as to alienate the people on this fringe. This alienation actually drives people in these areas to become more entrenched in car culture.

The fact that Vacca mentions express buses in his comment-- something most people living in Manhattan and the gentrified outer boroughs have probably never even heard of-- shows an easy win for sustainable transit policy makers. Select bus service is amazing, but so far has been positioned as improvements on existing local bus routes. Directing these sorts of changes towards express bus routes shows that the city's policy makers are specifically targeting these marginal individuals who would otherwise be nudged towards an auto-oriented existence.

I believe that targeting these marginal individuals is the key to New York City's transportation future. The transit oriented future of New York does not rely on making it easier for people living within the downtown core to stick with alternative modes of transportation. They already have the infrastructure available, and the car free culture to live off of. The future lies in the marginal users. Only by giving marginal individuals an easier alternative to car culture will we be able to begin to affect the greatest amount of change. Urban living isn't something that has to remain insular from the rest of the country; it is something that can be spread very easily.

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Sudden Changes in Demand and the Great Inversion

I've been making my way through The Great Inversion by Alan Ehrenhalt. His main thesis is that the majority of the changes going on in central cities, which is occasionally attributed to gentrification, are actually symptoms of a more systematic demographic inversion taking place across the country. This process is fairly quickly reversing a decades long trend of suburbanization to create new American cities that more closely resemble those of nineteenth century Europe.

This is an extremely apt observation. While gentrification as a process occurs, it's important to put it into a larger framework of what the root cause really is. It always has taken as its assumption a changing pattern of demand (coupled with a potential value in urban land not currently realized), and Ehrenhalt's analysis of what this means for downtowns, exurbs, and everyplace in between is extremely enjoyable.

One thing I still found missing from the analysis is a clearer explanation of why this change in demand is occurring. The demand created by aging boomer parents is fairly apparent, but it isn't so with millennials. For millennials, Ehrenhalt included anecdotes of college students polled showing a preference for living in the city, after watching Seinfeld and Friends from the safety of the suburbs.  While I'm sure this happened to many American college students, I still think there is something broader to be said about the general change in urban demand among millennials without falling back on the story of the bored suburban kid rebelling by moving to the big city.

A possible explanation for this change in demand is the fact that suburban growth was always in essence a ponzi scheme. Demand for the suburbs was dependent on the fact that demand for suburbs would always continue among later cohorts. The analogy I would draw is a line that is constantly growing longer. You'll more willingly get on line if you see people will gather behind you. The wait doesn't seem too long when compared to the growing number of people behind you. Whatever inconveniences you have to deal with in your suburb is mitigated by the fact that people are still moving further away than you, and they have it worse out there.

Of course like any ponzi scheme, collapse is inevitable. Once this process stops, demand for suburban areas as a whole ends up suffering. Exurban areas immediately feel the hit, as they have during the latest housing crisis, and other suburban areas are forced to adapt in the myriad of ways Ehrenhalt describes, which depends on whether the metro area is growing, stagnant, or declining, and how far out the area is.

This ends up describing both why this change is happening now, why it seems to be happening to millennials (it would happen to any cohort in our position), and why the change seems to be happening so suddenly.
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Parkchester: Bad Urban Planning at its Best

I took these pictures of Parkchester in the Bronx the last time I was biking in the area.

Parkchester was built as a middle income housing project, similar to Stuy Town in Manhattan. On the surface someone would probably classify the development with other failed urban renewal schemes styled as "towers in the park," but there are some positive qualities that set Parkchester apart from comparable projects and developments.

Unlike other developments, Parkchester has two fairly major streets passing through it: Metropolitan and Unionport

While a lot of the smaller dead ends within the complex are very sparse, and contain only building entrances set back from the street, the main streets serve as commercial arteries that interact with the towers very successfully in my opinion.

In the Death and Life of Great American Cities, Jane Jacobs prescribes inserting a grid into the parkland, and replacing the footprint of the spread apart towers with storefronts closer in. I imagine if lower income projects in New York ever were remedied in this way, it would look a lot like this.

Jacobs framed this as more of a "best case" for integrating towers into a neighborhood, while favoring the smaller scale of her native Greenwich Village. I think this is an example of how nuanced urban planning problems can be. A place like this is a more vibrant and accessible community than Greenwich Village today, and it gives hope that urbanism can survive in areas that on paper may seem like urban wastelands.

Check out Forgotten-NY's post on Parkchester as well for some pictures of its whimsical art.
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More Thoughts On Why The Rent Is Too Damn High

I actually wrote my last post before realizing that it was one of the central ideas in Matthew Yglesias' book: The Rent Is Too Damn High.  I'm really glad that the this relationship between development and rising rents, or as Yglesias calls it "the mirage of gentrification", is getting more popular exposure.  Hopefully this, combined with the numerous other calls for increasing densification will actually have an influence on public policy.

While Ryan Avent and Edward Glaeser show the simple case that allowing development will alleviate rental prices, Yglesias' continuation of the theory to explain WHY policy makers think development causes higher prices is the key of why development continues to be fought.  One added problem here is what I explained in my last post: any cause of NIMBYism strengthens the perceived link between increases in density and rent prices.

In this way, Charlie Gardner is right in his take on this book: cities can't simply "build" their way to affordability.  They can build their way to relative affordability, but there will always be a relationship between denser city center and unaffordability.

I plan to do a lot more thinking on where exactly denser development should be occuring.  I'd like to suss out whether it's more useful to build more housing units in a city core or just outside a city core.  One thing to note is in order to increase affordable housing, it makes sense to start at a location where housing prices are simply high and not astronomical.  

In the coastal cities, there can never be enough development in major city centers to handle the demand to live in prime locations.  In some coastal cities (though not all) you also have a steep drop off in density, meaning outside of the core areas the metro area is more spread out and can't take advantage of the economies of scale you get with density.

Perhaps instead of building up an area like Manhattan, we should try to make other areas like Manhattan.  For recently gentrified outer borough neighorhoods, realize that they were gentrified for a reason.  Instead of building up those areas with the intent of making them more affordable, develop the already affordable frontier neighborhoods to make them more desirable.  While I agree that we should remove a lot of restrictions we have on development in central cities, this additional policy focus will help the entire region become more liveable, and thus make more liveable areas affordable.
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The Key Fallacy in the Debate Surrounding Height Restrictions

Emily Badger at the Atlantic Cities writes a balanced piece on the debate surrounding height restrictions in cities.  On the one hand, we have density being a quality that provides positive externalities for cities by itself and should be encouraged, while on the other you have the negative effects of density such as loss of sight lines, possible increases in congestion, and increased use of city services.

One thing she throws in somewhat casually however, is that this increased density may raise rents.  I've previously written about this fallacy in a different context, but this is a purer example of how this kind of thinking can be damaging.  Densification has both positive and negative externalities, and these deserve to be compared to come up with a more coherent plan on how to maximize density while minimizing the negative side effects if may lead to.  Rising rents simply isn't one of these negatives.

The problem is rising rents and densification are definitely correlated in most practical cases, and wouldn't be in a purely theoretical context. Instead of densification causing rising rents however, they are both caused by an exogenous increase in demand. Whenever you have restricted development (which is pretty much the only type of development that can happen in a city), an exogenous increase in demand will lead to a pent up need to increase supply. Because development is limited and supply is not able to catch up with demand, prices will rise.

When you compare this to more stagnant areas which have no increase in demand, and therefore will have no invasive development and no increasing prices, one can erroneously think that the development in the more popular area is what caused the high prices.

This sort of dynamic can be dangerous because it feeds into itself.  The more restrictions in place, the more pronounced this effect will be.  This means that the cities that are more predisposed to restrict development will seemingly be proved right more than those with more lax restrictions.

I'd even go farther with this line of reasoning.  I'd argue that restrictions on development could increase the other negative effects of density.  A developer without restrictions might be more able to make their property more desirable than others; they'd add some public space, or build more aesthetically pleasing buildings.  If a developer is constrained, they'd be more focused on squeezing in as many units as allowed by law, perhaps at the expense of those more aesthetic effects.  This only adds to the feedback loop, and the city will be again be prompted to restrict development further.

The only way out of this is to realize this connection simply does not exist, and to try to completely divorce housing prices from arguments about densification.  Despite what evidence may suggest, prices are still driven down by increases in supply.  While I personally believe there should be less restrictions on development, there are still valid arguments to be made on the pro-restrictions side.  Rising rents simply isn't one of them.
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Adventures in Gerrymandering

Gothamist ended up getting their hands on the newly redistricted State Senate and Assembly districts.  While they posted some examples of primo gerrymandering, the district including the neighborhood I grew up in caught me as particularly flagrantly drawn:

I grew up here so it was immediately apparent why this shape was chosen.  Here's a hint.

District 34: The White-People-Who-Live-in-the-Bronx-and-Some-White-People-from-Pelham-So-It's-Not-Too-Obvious-That-We-Literally-Drew-This-District-Based-On-Race-But-Ew-Make-Sure-You-Don't-Include-Mount-Vernon-It's-Kinda-Sketchy-There-If-You-Know-What-I-Mean District.

This is why I just can't get into politics.
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Infrastructure for the Future

The A Train, going through an empty field.  Picture from
I've been thinking a bit about how forward looking city investment has been, how this sort of thinking changes over time, and what factors might lead to changes in the "forward looking-ness" of this sort of investment.

At first I didn't even really consider changes, and considered the effect more exogenous.  I would think that it's simply politics, something that changes at the whim of society, and ends up framing how long term investment ends up happening in a city.

The one example that always gets me considering this is the New York City subway system.  I would always think how ridiculous the current capital projects are when you compare it to the subway's history.  Subways were originally built to farmland.  There was no existing demand, it was assumed that people would begin moving up there around subway lines as the city developed.  

Today, the MTA is officially working on two line extensions entirely within Manhattan, one of which through the densest neighborhood of Manhattan.  While it makes sense to build infrastructure where it will benefit the most people, and that place is exactly where the MTA is working on it, it's obvious that the subway was formerly developed for FUTURE use, and with an eye out for how the subway would effect the development of the city.

Looking at this degree of forward future consciousness a bit more however, I ended up coming up with a few alternative explanations.  one is the fact that the subway was originally developed by private companies that had their own real estate interest, where it makes sense to build subways to your own developments where remote land is cheap, whereas now the MTA is more controlled by the government which exists to serve the current population.

More interesting however, because it's a relationship that can be tested elsewhere, is simply the fact that development becomes less forward looking as cities or infrastructures themselves age.  A blank slate lends itself to grand plans without precedent, while an older city and infrastructure is thought of as "set" and the framing of any investments change from future inhabitants to the current inhabitants.

This is interesting because it's obvious we should always take these future considerations into account, and if this relationship really does exist, then there is some sort of systematic bias towards stagnation in older cities that can be predictably accounted for.

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