The Long-Term: A Common Problem

Economists are interested in utility: where to find it; how to create it, and how to maximize it. One of their most important models regarding it holds that long term thinking yields greater utility. A bit of frugality earlier in life, with money put away in a portfolio and CD, can provide many times that amount down the road when the saver is perhaps less well suited to earning their living. All that is required is a rational analysis of circumstance, and then action based on those rational conclusions. Classical economics operates under the assumption that people will follow this order of operations and maximize there utility. However, anyone who steps out of their local intro-to-economics course, will see that this is far from the reality of how the world works. People consistently give preference to the short-term, and the new field of behavioral economics is interested in understanding how and why we do so, and how we can craft the world around us to encourage better long-term thinking.

Preservationists face a similar issue regarding long-term thinking. We understand that Heritage has great potential to be a meaningful and useful aspect of our lives so long as it is managed correctly. However, Heritage is under constant threat from dramatic change, often in the name of some short-sighted project or solution to a problem. Perhaps the problem is that land and buildings are predominantly treated like commodities to be traded in the marketplace, subject to fluctuations in supply and demand. Vibrant, low-density neighborhoods may be bought up and razed by developers as the land becomes more valuable thanks to proximity to other resources or jobs, with little or no thought given to what is lost or how the new development will adapt to changing conditions or add to the character of a city in the long-term.

This analogy between money saved or spent today and built Heritage utilized or destroyed is a tenuous one. Much destruction is done under the guise of encouraging economic development, and while a project may be successful to that end in the short-term, many projects simply follow the market rather than consider ways that the built environment can provide for long-term growth and stability, potentially in opposition to the volatile market. The issue of long-term thinking in preservation and economics will continue to be a problem; however, through the growing field of behavioral economics, many financial institutions are seeking ways of restructuring themselves to better encourage long-term thinking in their clients, and improve utility. Is there also potential for the same field be a valuable tool in rethinking the policies that shape how we interact with the built environment, such as zoning, tax credits, and building codes? Improvements in long-term thinking with regards to the state of the built environment and of local economies could help to balance these often conflicting development concerns; thus more effectively moderating change.


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