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Simulation of cottage lot subdivision : a synthesis of social, economic and environmental concerns Chamber, Alan David

Abstract

Concern with the inability of traditional measures of value to reflect environmental quality led to this search for another measure to be used in the rapidly developing Gulf Islands of British Columbia. The measure identified, our subjective preference for cottage lots of various sizes, is defined mathematically and compared with the more traditional measures—development cost and market price. A set of 35mm colour slides, all apparently taken from the same cottage porch, were manufactured by superimposing images of various numbers of neighbouring houses on four background scenes. When shown the slides and asked which view they would prefer from their own cottage porch, subjects were found to respond to the number of neighbours and distance to the nearest according to Weber's law. By transforming nearest neighbour distance to a measurement of area, a relationship between subjective preference and lot size is established. To compare the above subjective preference - lot size relationship with more traditional measures of value, a generalized total cost function for cottage lots is built and then tuned with data from the literature. From the total cost function both average and marginal cost equations are derived and plotted for lots of varying size. As might be expected, there is no apparent similarity between subjective preference and development cost for lots of any particular size. With the cooperation of the Provincial Assessor and Registrar of Lands, market price, lot size, date of sale, and other data were collected for 579 parcels of the Gulf Islands. An analysis of this data suggests that, under conditions of very rapid development, the subjective preference - lot size relationship, might be reflected in the market prices. But this traditional measure of value is not a reliable reflection of subjective preference. In an effort to learn some of the conditions under which subjective preferences could be satisfied, a measure of the impact of development upon environmental quality is conceived and incorporated in a mathematical model of the development of the Gulf Islands. Within the model, developers subdivide land in response to demand for cottage lots, their desire for profit, and the cost of producing the lots. The sensitivity of the model to various policy interventions is then tested.

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