Growth, no-growth, and balanced growth

Material Information

Growth, no-growth, and balanced growth complex issues for the community
Series Title:
Economic information report
Abbitt, Ben
Place of Publication:
Gainesville [Fla.]
Food and Resource Economics Dept., Agricultural Experiment Stations and Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida
Publication Date:
Physical Description:
14 p. : ; 28 cm.


Subjects / Keywords:
Cities and towns -- Growth -- Florida ( lcsh )
bibliography ( marcgt )
non-fiction ( marcgt )


Bibliography: p. 14.
General Note:
Cover title.
Statement of Responsibility:
Ben Abbitt.

Record Information

Source Institution:
University of Florida
Holding Location:
University of Florida
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
026825431 ( ALEPH )
10827891 ( OCLC )
ACG0211 ( NOTIS )

Full Text
Economic Information

Report 69


and Bala


nced Growth:



in the Community

Food and Resource Economics Department
Agricultural Experiment Stations and
Cooperative Extension Service
Institute of Food and Agricultural Sciences
University of Florida, Gainesville 32611

May 1977

Ben Abbitt



Florida, a state with an increasing population, expanding
commercial and industrial complex, and a diversifying agricul-
tural industry is beginning to face the fact that the benefits
and costs of continual growth will have to be given due consid-
eration in the planned future of the state. A summary of some
advantages and disadvantages of this growth is presented along
with some thoughts on the balanced growth and no-growth issues.

Key words: growth, no-growth, balanced growth, capitalistic
system, affluence, inflation, real income, poverty income level,
amenities, litigation, leap-frogging.


Ben Abbitt


Few issues have been equated more with economic and social

progress or with individual and community betterment than those

related to growth. Programs for growth, no-growth, and balanced

growth are widely discussed and frequently elicit different

opinions among political, social, and economic factions.


Economists generally define growth as an increase in some

designated economic variable over time. Thus defined, growth

can refer to increases in real income, farm output, and personal

or community income. Physical growth is possible, too. In

Florida, growth is often defined as population increases and

expansion of businesses to serve winter visitors and new,

permanent residents.


No-growth is best defined as opposite of growth. No-growth

exists where there is no change in the level of output resulting

from innovation or new technology. From an economic viewpoint,

no-growth is a zero increase in per capital output of goods and

services. Innovation, mechanization, or some other change in

production techniques, may or may not be encouraged in a no-growth

BEN ABBITT is an Area Economist, Food and Resource Economics
Department, University of Florida, AREC, Lake Alfred, Florida 33810.


situation. Efficiency increases that lower costs without altering

output are considered no-growth situations. Not encouraging new

industry and accompanying population and service concerns are

examples of no-growth policy.

Balanced Growth

Balanced growth is best identified as a middle ground between

growth and no-growth. In other words, balanced growth, or as some

prefer, managed growth is that process in which communities expand

and grow in a planned manner. Using a community's resources

(human and natural) to provide for planned and orderly business

and commercial expansion is considered to be balanced growth.


The purpose of this writing is two-fold. First, background

behind the growth, no-growth, and balanced growth issues will

briefly be summarized. Secondly, advantages and disadvantages

of community growth will be outlined. This background information

should provide the reader with a better basis for judging growth,

no-growth, and balanced growth issues within the community.


Growth has long been accepted as a national policy in the

United States. This country's early settlement was led by

immigrants who sought personal and commercial improvement associated

with religious, political, and economic freedom. As the western

frontier was settled, new transportation systems (highways and

railroads) were built to service the growing population of these

areas. This larger, regional population base meant increased

demand for land,for housing units and for commercial and

industrial expansion.

Growth was identified with progress. Economic progress

meant increases in the quantity, quality, and availability of

the goods and services of the nation. The United States fostered

a society whose actions were directed toward a bigger, better,

and richer country.

There is little doubt that the capitalistic system was a

dynamic force in the early growth of the country. Competition,

emphasis on technological advancement, individual enterprise,

and self-betterment, all led to increased utilization of the

nation's resource base. Land, water, and energy resources were

used at an increasing rate to hurry the nation along its path

to be the biggest, strongest, and most affluent country in the

world. Growth brought us (individual, community, and nation)

new employment opportunities, a bounty of material wealth,

relative affluence for most citizenry, and a very different world

from that of the founding fathers and the early settlers of the

western frontier.

Recently, however, we are finding decaying central cities,

expanded welfare roles, and significant divergences in income.

In addition, the costs for the necessities of living (food,

clothing, and housing) have risen steadily in the recent decades.

In the United States' growth economy, it appears inflation has

become more or less, a permanent houseguest to deplete consumer



Growth represented a somewhat different challenge 200 years

ago than it does today. In the late 1700's, one of the major

challenges was to settle the United States and put technology

and natural resources to work for the betterment of man. Much

of this earlier challenge has been met. We have populated our

portion of the earth, provided technical and economic assistance

to other countries, and at the same time, have created the

highest standard of living in modern day history.

This historical pursuit of growth has also nurtured negative

side effects as noted by economist Robert L. Heilbroner:

The lesson of the past may then only confirm...that man
does not live by bread alone. Affluence does not buy
morale, a sense of community, even a quiescent confor-
mity. Instead it may only permit larger numbers of
people to express their existential unhappiness because
they are no longer crushed by the burdening of the
economic struggle [1].

Today we are increasingly questioning the desirability and

long-term benefits of continued commitment to unrestrained growth.

The overriding question is whether or not continued growth is

harmonious and consistent with continued availability and quality

of the nation's natural resources; particularly land and water.

In the past, consumers and businessmen alike have assumed that

they could continue exploitation of the country's natural resources

as though they were available in unlimited quantity and not

subjected to deterioration in quality.

What lies ahead? Assuming we wish to provide our citizenry

and future generations the opportunity to enjoy a continued high

standard of living, community leaders and citizens now envision

resource shortages and environmental problems if consideration

is not given to modify the emphasis on continued growth.


Before'identifying disadvantages associated with growth in

the community, let's review some of the advantages associated.

with growth.

The Wage Earner and Real Income

Historically, wage increases have been associated with

increased productivity, and, more recently they have resulted

from increased union contracting. As growth results in increases

in per capital output, it is expected that labor's income will

increase [2].

Inflation has not always been a fixture in the United States.

Thus, if we ignore inflation momentarily, increased incomes

resulting from growth can be expressed as real increases. That

is, incomes rise by a greater amount than do the prices wage

earners must pay for goods and services. Increases in real

income also result when more efficient production practices

lead to a drop in prices. In other words, the purchasing power

of wage earner's salaries increases. That is, the wage earner

can buy more goods and services.

The Wage Earner and Inflation

If the assumption to momentarily ignore inflation is dropped,

then it follows that income increases must exceed the rate of

inflation to better the worker's plight. That is, the wage earner's

pay increase must offset the higher prices that accompany inflation.

It is important to note that increases in general income

levels can lead to increased spending and inflation if they are

not accompanied with corresponding increases in output. Without

accompanying increases in output, rising income levels mean

rising costs of goods and services, hence inflation.

Residence Location and Community Wealth

As growth occurs, job requirements and available labor may

be incompatible so that labor will have to be imported. Workers

will either move into the community and become permanent

residents, or they will locate within commuting distance. Payroll

spending is, in a large part, dependent upon residence location.

That is, workers usually spend a large proportion of their

paychecks in the community in which they live. In addition,

revenue from property tax assessments on homes and real estate

influences community wealth. Thus, growth with subsequent labor

mobility directly influences wealth among communities.

Greater Tax Base

Some consider population increases and commercial and

industrial expansion in the community positive attributes of

growth. They are attractive because, in addition to the immediate

benefits accruing to the employed labor in the form of higher

income, the new firm's facilities become part of the communities'

tax base for computing real estate taxes [2]. Since real estate

taxes are a major source of revenue for many communities, an

opportunity to increase the tax base represents an opportunity

to increase revenues without increasing the rates of assessment.

Moreover, should additional revenue not be required after expansion,

there may even be an opportunity to reduce the tax rate.

Ih addition to the tax base created by the new firm, there

may be an increase in the amount of residential real estate if

the new firm attracts new residents to the community. This

additional real estate may have the same effect as the new firm's

facilities did on the tax base; .that is, increase it without

necessarily raising the tax rate. Each situation is unique and is

dependent upon the service demands placed on the community by the

new residents.


Distribution of Income Increases

One of the opportunities for increased real incomes through

growth is the possibility of reducing income poverty in the

community. One question to be answered, however, is, who receives

the increases in income resulting from growth [2]? Does the

additional income go to the poor or is it transferred to those

whose incomes are above the poverty level? If it is the latter,

growth may aggravate any existing income equity problem. If this

occurs, income distribution resulting from growth becomes less

equitable rather than more equitable.

Resident or Non-Resident Employment

Many consider unemployment to be one of the major reasons
for income poverty. Employment opportunities help to alleviate

IThe 1977 poverty income level is $5,500 for a nonfarm
family of four.

this problem. However, it is important to note whether the new

jobs from growth will be taken by local labor, or whether the

new job requirements will necessitate non-resident labor. If

the objective of additional growth is to help alleviate local

poverty, and the indigenous poor are not qualified for the jobs;

then, with respect to income distribution, growth will not

achieve its objective.

Expansion and Funding of Public Services

Land use practices in the community are constantly

changing. The change in most communities is from low intensity

uses to higher ones. Land is being transferred from agricultural,

forest, or idle use to more intensive uses such as single family

housing units, condominiums, business outlets, and service concerns.

If growth in the community has resulted in illogical development

patterns that require further investment to provide expanded

service facilities, these increased service costs to the enlarged

community are usually collected locally. Funds may be collected

by raising the real estate tax millage rate or by increasing the

assessed valuation of real estate in the community.

S Some political jurisdictions require property assessments

be based on market values which sometimes are much greater than

the value derived from actual use, particularly a low intensity

use such as agriculture. The assessments increase as market

values increase. This makes the holding of land for low intensity

uses such as production agriculture and open space less attractive.


Physical Examples

Whether or not communities have the right to limit size by

regulating future growth is one of the more perplexing problems

facing community planners. In the past, it was often assumed

that all communities wanted and needed to grow. Growth was

synonymous with free competition, increased production, rising

income levels, and a higher standard of living. During the past

two decades, however, some have come to realize that rather than

helping cure community problems such as income poverty and

unemployment, growth may be the culprit behind the loss of

community amenities. These amenities include, among others,

personal privacy and relief from city congestion.

Those who have moved from large cities to enjoy the

amenities of rural or suburban communities often are seen leading

the campaign to "close the gates" to prevent others from moving

into "their" communities. They point out that limiting or

controlling population growth is the practicable method for

keeping the values they came to enjoy.

Recent examples of this view include Colorado's rejection

of the 1976 Winter Olympic games, Oregon's discouragement of

permanent immigration, and Massachusetts' moratorium on freeway

construction in the Boston area.

Legal Examples

The constitutional issue of whether a community has a right

to limit its growth may be decided in the near future. Individual

court cases challenging the right to control or regulate growth

and development are increasing throughout the land. The

Pennsylvania Supreme Court has ruled that zoning regulations

designed to frustrate natural growth are illegal, and a

Colorado court has outlawed the attempt of the city of Boulder

to prevent building by denying the builders hookups to the city

water and sewer system. In a Belle Terre, New York case, however,

the Supreme Court has recognized the right of communities to

limit residential areas to single family homes.

In 1972, the city of Petaluma, California by ordinance,

created a slow-growth plan which limited further residential

development to 500 units each year for the duration of a five-year

growth program in addition to establishing a 200-foot wide

greenbelt to help stem urban sprawl [4]. In 1975, this ordinance

was appealed by Petaluma developers. The plaintiffs contended

that the ordinance was arbitrary and unreasonable, and was

intended solely to insulate the city from the San Francisco "urban

complex." The developer's litigation failed as the Ninth U.S.

Circuit Court of Appeals said, "the concept of the public welfare

is sufficiently broad to uphold Petaluma's desire to preserve its

small-town character, its open spaces, and low density of population

and to grow at an orderly and deliberate pace [3]." In a more

recent development in the case, the U.S. Supreme Court refused

to hear an appeal by the developers to overturn the appeals court


Another test of the rights of communities to make decisions

concerning their future growth is underway in Florida where Boca

Raton has acted to limit residential construction to a total of

40,000 residential units. City officials maintain their action

is necessary if Boca Raton is to maintain a desirable community

in which to live and not resemble other, more densely populated

cities in peninsular Florida [1]. The construction industry

appealed the city's residential cap in the courts and it was

subsequently overturned. Prolonged litigation is anticipated

since the lower court's decision is currently being appealed to

a higher court.


Many feel that in order to conserve our natural resource

base and to help insure a constructive environment for future

generations, communities must begin to plan their individual

growth. There are several devices used by community planners

to help provide orderly, balanced growth. Moratoriums on sewer

expansion and housing starts help discourage immigrations into

communities. Strict zoning ordinances inculcated in land use

plans for municipalities and counties help guide commercial and

industrial expansion into the rural areas surrounding metropolitan


The city of Ramapo, New York, provides a clearer understanding

of the balanced growth issue. In 1969, Ramapo adopted a new

approach to regulate its growth. In brief, the city amended its

zoning ordinance to create a special permit whose acquisition was

granted only if standards were met for minimum facilities and

services to the new development. Ramapo was pursuing an overall

development plan and a capital improvement plan was to be drawn

from the development plan.

The ordinance was subsequently attacked by landowners as

destructive of the value and marketability of their property.

The highest court in New York upheld the ordinance in the

opinion: "Golden v. Planning Board of Town of Ramapo, N.Y.S.


A major contribution of the Ramapo ordinance is its direct

connection between residential improvement (private sector) and

capital improvements (public sector) [2]. This ruling is

considered by many as a landmark in support of balanced growth

for the community. Due to the short time span since enactment,

results are inconclusive as to the success of the Ramapo plan.

The planning commission in Collier County, Florida, has

also recently begun a program to control growth. In brief, a

rating system has been set up to determine the availability of

existing community facilities and services when residential,

commercial, or industrial development is proposed. A petition

receiving a rating of thirty-one points or more is designated

by the commission to have adequate existing community facilities

and services for the proposed residential density and/or

additional permitted uses in the requested zoning district. With

this "passing" rating, the proposed development is not considered

leap-frogging by the planning commission. Leap-frogging is

characterized by large bypassed tracts of land between developing

areas and a scattering of urban development over the rural



Growth has helped provide the current level of material

wealth and high standard of living enjoyed in the United States.

One of the basic foundations of economics is that economic

resources (natural, human, and man-made) are scarce and limited

in quantity and quality. While our capitalistic system worked

well in our frontier society and early era of a bountiful

quantity of natural resources, it alone may not be adequate for

those who see the need to protect, conserve, and husband out more

fragile, natural resources. Overpopulation, environmental

pollution, increased demands for fixed resources, and impending

shortages of energy and raw materials are no longer problems

for future consideration. They are with us now.

It is a challenging prospect to identify, discuss, and

evaluate the future courses communities can and will follow,

with regard to growth, no-growth, and balanced growth. The

issues are complex, interrelated, and far reaching.

As noted earlier, when decisions on community growth are

made, there will be some individuals and communities who will

gain and some who will lose. Before winners and losers are

borne out, care needs to be taken to carefully evaluate the

advantages and disadvantages associated with growth within each



[1] Barlowe, Raleigh. Growth and Development, paper presented
at Short Course for Intensive Training for Non-
Metropolitan Development, September 25 October 3, 1975,
Michigan State University, East Lansing, Michigan.

[2] Bellows, William I. The Economist's View of Economic
Development: Opportunities and Problems, paper presented
at the Workshop on Controlled and Balanced Growth:
Evaluating Community Impacts of Economic Growth Proposals,
June 16 19, 1974, University of New Hampshire, Durham,
New Hampshire.

[3] Land and the Environment, Vol. 4: No. 5, March 5, 1976,
(A Bi-Weekly Business Newsletter), Business Publishers,
Inc., Silver Springs, Maryland.

[4] Scott, Randal W., editor. Management and Control of Growth,
the Urban Land Institute, Volumes II, III, 1975,
Washington, D.C.