u/ColdSpecial109

It seems that the prevailing thought in this sub believes that its more efficient to run a high density city than a suburb because in theory it would be more more efficient to run infrastructure in a high density city than a suburb because theoretically you would need less electricity, roads, pipes etc... to run a highly dense city so it would cost more than suburbs. However, we see the opposite is true. Even aside from housing, the cost of living from everything from electricity, food, water ends up costing more in a city. This is even true when you correct for income. NYC and Long Island have similar incomes for example, but NYC pays $0.31 per kilowatt hour of electricity while Long Islanders pay $0.24-0.27 per kilowatt hour.

So why is that?

The problem is that it seems that people only think about material costs of a product in their "efficiency" calculations (how many pipes you need, how many roads you can build, how much electricity you can supply, how much food you can deliver etc...), but the problem is that material costs of a product are not necessarily the big ticket costs to these things, logistics and especially transportation logistics is. For example logistics are 55% of electricity prices and 58% of food logistics cost. Logistics as a whole is 9% of GDP which is 3-4x larger than infrastructure (2.3%). The fact that dense cities are incredibly challenging logistically is the reason they are not as efficient.

Take for example food for example, a lot of the increased cost for food in cities is due to the complex challenges in last-mile delivery which is 53% of the transportation costs. In a suburb, you are probably delivering to a big box store off a highway exit. You are delivering from a distribution center and using lower traffic highways which are more efficient to drive in, your last mile delivery cost is minimal since the store is probably half a mile from an off ramp. Because the big box store is big, it can store a lot of excess inventory so you can minimize frequency of deliveries. Obviously, a store like WalMart has mastered this so well that they can sell at prices lower than many small retailers can even buy at. In the city, last mile delivery is very challenging. It starts by requiring trucks to be on city roads which means more stop and go traffic, smaller trucks meaning less capacity, shortened delivery windows due to how busy a city is, and increased demand for food given the density of a city with less storage space in a store to carry excess inventory. This means not only is last-mile delivery inefficient in the city, you will be forced to make orders of magnitude more trips to supply the same number of people with groceries. This also applies to any project that requires materials to build or fix anything. Transporting pipes, concrete, wires, garbage etc... all is very expensive in the city because of logistics. Why is fixing a pothole is so expensive in the city. How are you going to get the concrete, trucks, people to get there?

Obviously, the same logistical problems exist in rural areas where you have to deliver lots of services to a small number of people so the quality may not be great, so its not just big dense cities with logistical problems.

However, suburbs get the best of both worlds and they are more optimized for efficiency than you think because they get the benefit of density without the drawbacks of logistical complexity.

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u/ColdSpecial109 — 8 days ago