State Intervention in Local Land Use Decision Making: The Case of Massachusetts

• Published in: Real estate economics Vol. 41; no. 2; pp. 418 - 447
• Main Author: Fisher, Lynn M.
• Format: Journal Article
• Language: English
• Published: Bloomington Blackwell Publishing Ltd 01.06.2013
• Subjects: Compliance; Decision making; Decision making models; Developers; Land use; Permits; State laws; Studies; United States > US; Massachusetts; USA, Massachusetts
• ISSN: 1080-8620; 1540-6229
• DOI: 10.1111/j.1540-6229.2012.00340.x

The permitting process for residential development in the United States is largely administered by local governments. This article empirically assesses the responsiveness of local decision makers to a state‐mandated permitting process that may require them to ignore or override locally adopted land use regulations. I develop a screening model to formalize expectations about permitting outcomes between developers, who hold private information about their projects, and local Zoning Boards of Appeal under the rules of the Massachusetts law known as Chapter 40B. I then analyze a novel data set of 40B permit applications made during the period 1999–2005. I examine summary statistics and estimate a bivariate probit model with selection in order to jointly evaluate the determinants of local permit approvals and developer acceptances of permits. I find that, in general, local institutions comply with the state‐mandated permitting process and that permits granted to developers typically result in housing production. I also find that information asymmetries and community characteristics influence the success of the permitting process in a manner consistent with this study's screening model.