Preventing Magapolis Being A Mega Blunder
By Hema Senanayake –December 25, 2015
Hema Senanayake
With the Western Region Megapolis Development project one important economic factor is going to be changed. That factor will be the land use regulations. “Poor land use in the world’s greatest cities carries a huge cost.” This is true and this quote is the subtitle of an enlightening article which is titled “Space and the City” published in The Economist magazine in April this year. Will our own Western Region Megapolis do the same mistake? I hope we can avoid it now but not in the future.
In the said article it argues that “in fact land is not really scares.” I like that argument because I too argue in this series of articles that if we remove the systemic push for extreme consumerism, in fact with continuing inventions and the development of technology, human civilization can create abundance in goods and services for the wellbeing of its all members. The market mechanism is the conduit through which we can reach that goal. Upon reaching there, it requires unprecedented adjustments for the market mechanism because it is common sense that with having abundance in goods and services the normal market mechanism cannot prevail. Let us leave it there for the time being and let us get back to our topic.
However, even though land is not really scares, the land use policy and land use regulations can make land scares and make prices skyrocketing. When this happens the economic effect is that much of the gains of economic activity would not flow to workers and entrepreneurs/investors. Rather more of the gains of economic activity would flow to land and property owners. Why is this bad? It is because that most of the cost of doing businesses would be to pay for building cost. For workers who live in rented houses or apartments, the major component of their income would be eaten up by the house rent. For people who live in their own houses or apartments, much of their income would be ended up paying mortgage cost. These things have to be changed from the beginning of our much anticipated first Megapolis. Read More