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Abstract: In December of 2002, the Metro Council of Portland, Oregon had to decide whether or not to expand the Urban Growth Boundary (UGB) for the metropolitan area. The UGB had been created as a tool to help promote a more compact, livable, and efficient metropolitan area. But Portland's housing prices had been increasing rapidly, and home builders and others were arguing that the UGB was at fault for too tightly restricting the supply of developable land.
Learning Objective: This case, intended for a course in urban planning or economics, is designed to support a discussion of how the various forces of supply and demand, including zoning restrictions, affect the price of housing. It can also stimulate an examination of the rationale for various types of zoning or growth controls. Part B (1704.0) is an optional note that provides additional background on how housing prices are measured.