Introduction

This is a book about how the cities utilise space and how the resulting urban form provides different ways to deal with the tangle of public goods and externalities caused by agglomeration. We rely on well-known economic thinking plus a historical analysis to why cities exist and why they have evolved to be the way they are. We identify several defining factors: the geography and the technology (both defining what is possible to do), culture (which defines what the society’s goals are) and the necessary government regulation in the presence of public goods and externalities (determined both by culture and the desire to achieve positive economic outcomes). Regulation is the set of rules (not only planning codes) that underpins how markets are allowed to work in the city. Our method is also comparative as it explains the evolution of urban form in the US and how it stands in a sharp contrast with the evolution of urban form in Japan. An emphasis is put on the difference in regulations between both jurisdictions. We point out that, against the conventional wisdom, how American cities are constrained by rules that are much further from the “neoliberal” economic idea of free and competitive markets than the Japanese ones. We demonstrate how Japanese planning fosters competition and variety in the availability of goods and services. We also include an explanation of the origin of the differences in those regulations. We hypothesise how changing regulations could change the urban form to generate a greater variety of goods and to foster the access to those goods through a more equitable distribution of wealth. Critically, we point out that a desirably denser city must rely on public transport, and we also study how a less-dense city can be made to work with public transport. We conclude by claiming that changes in regulations are very unlikely to happen in the US, as it would require deep cultural changes to move from local to a more universal and less excluding public good provision.