JOURNAL OF URBAN ECONOMICS u, 310-330 (1988) The Qualitative Economics of Development Control STEPHEN SHEPPARD* Department of Economics,Virginia PolytechnicInstitute and State University, Blacksburg, Virginia 24061 Received February 12,1986; revised August 19,1986 This paper examines space supply restrictions and containment policies in the context of a monocentric urban model with several classes. Results are obtained concerning the qualitative effects of such policies on space (i.e., land) values and bCatiOIlS Of the VtiOllS @OUpS. 0 1988 Academic Press, Inc. I. INTRODUCTION Communities in virtually all economiescontrol development and land use within their jurisdiction. This leads one to suspect that development control policies can have significant impacts on land values and the structure of an urban area. Several previous papers have analyzed the qualitative impacts of certain development controls. These papers have used a variety of approaches, both nonspatial models in which location choice and bid-rent functions play no explicit role and spatial models which explicitly address locations chosen by consumers, and the value of land at each location. Among the nonspatial models, are papers by Ohls et al. [9], Moss [8], and Grieson and White 141. Ohls et al. [9] considers the case of “exclusive use” zoning in which the total amount of land made available to various groups is constrained. The conclusion is that the effects of such zoning on land values is ambiguous. Moss extends the analysis to controls which force an increase in land per household. Without making restrictions on elasticities of demand, substitu- tion, and migration, he finds that the effects of such restrictions on land values are ambiguous. By imposing empirically sensible restrictions, how- ever, he concludes that minimum lot size zoning implies higher land values and housing costs and a larger metropolitan area. *Department of Economics, Virginia Polytechnic Institute and State University. The first version of this paper was written while at the University of Reading. The research was produced in the context of a project entitled “The Economic Consequences of the British Planning System: A Pilot Study,” funded by the Economic and Social Research Council. I thank Paul Cheshire, Alan Evans, Geoff Keogh, Alan Hooper, Mike Breheny, Christine Whitehead, Charles Leven, and an anonymous referee for helpful comments and discussions. 310 0094-1190/88 $3.00 Copyright 0 1988 by Academic Press, Inc. All rights of reproduction in any form reserved.