The catch-22 of frugality

Frugality can be a matter of necessity or choice. Also, it can mean frugal use of money, but also of other resources such as land, energy, time, etc.

It would seem that high-density housing makes relatively efficient use of land and energy. It would also seem that it costs more than low-density housing. A frugal person (especially one who is frugal out of necessity) would prefer small living quarters over large living quarters because less land, in theory, costs less money, and less square footage costs less money to heat. Less house or apartment should also be less expensive when it comes to maintenance. So why can’t we have what, by the yardstick of frugality, would be the best of both worlds; a small house on cheap land? Perhaps part of the reason is because many people, especially successful people, have finally figured out that high density living is more desirable than low-density living, and so America may well at some point join most of the world in having suburban ghettos instead of urban ghettos. A more insidious reason might be a built-in property of the market mechanism itself:

conserve what’s most expensive

Market actors have the strongest incentive to conserve those resources that are most expensive, so developers will make more effort to use every square foot effectively in places where land values are high. This also affects the ideological tug-of-war between advocates of sustainability and advocates of growth (i.e., affluenza). The fossil fuel apologists and other right wingers love to gloat that “the greens love high fuel bills.” I suppose we love high energy costs to the extent that we believe that high energy prices are the most effective incentive for energy efficiency and energy conservation. Being an anagorist (market abolitionist) I’m not sure I buy that theory about how “incentives work.” At any rate, high-density development in a cheap neighborhood seems to be too much to ask of the market. Is there some Iron Law of Economics to the effect that a walkable neighborhood in the U.S.A. has to be either a college town or a ridiculously gentrified east or west coast city?

the (first) customer is always right(est)

The frugal consumer will generally buy used, not new. Same for those who try to practice “reduce, reuse, recycle.” The designer of a product such as a house or car is thinking primarily about the first buyer. Someone who is in a position to be in the market for a new car is someone who is basically established—has steady-eddie income and established credit. This goes at least double for someone in the market for new-construction housing. These consumers are in most cases upper middle class and up. To the extent that these manufacturers and developers are thinking about the second hand buyer, they’re thinking in terms of maximizing resale value. While this means meeting the needs of at least a portion of the people who aren’t looking at new, it probably means the more affluent portion of that population, more than the less affluent. And of course the second-hand customer is “righter” than the third-hand customer, whose wants and needs are at most an afterthought.

is there a sweet spot?

Is it possible to build small-square-footage housing on cheap land? Is it possible for an affordable (that is, cheap) neighborhood to have high population density? Perhaps that’s how it was in the “pre-war” era, except that back then the market’s verdict was that high population density had negative utility. Is it possible to design an automobile in a way that prioritizes fuel economy and durability with high priority and purchase cost with medium to high priority, while de-prioritizing “performance,” “luxury,” etc.? It certainly seems to me that the constraints standing in the way of such a set of design priorities come from economics, and not science or engineering.

About n8chz

पृथ्वी की उच्च किराया जिले में उद्यमिता कौशल अभाव
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3 Responses to The catch-22 of frugality

  1. n8chz says:

    OMG it’s even worse than I thought. Quoderat informs us that even when one arrives in the new-construction-housing class, it’s more expensive to build new small than to build new large, because apparently “luxury home builder” is one word, and apparently their catalogs offer only McMansions!

  2. n8chz says:

    Frank Moraes: Maximalizing Minimalism – Fashion Pretending to be Ideology

    Minimalism, it seems, is the new conspicuous consumption.

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