SOLVING EXTERNALITIES PROBLEMS USING INNOVATIVE ARCHITECTURAL DESIGN

We advocate that solving externalities problems is the key to sustainable development. In this paper, we demonstrate how innovations in architectural design can help to internalize externalities. In spite of modern advances in the washer/dryer technology, a cultural habit of Chinese families is to dry clothes in open or airy areas such as their balconies. For congested high rise buildings in Hong Kong, such activities may or may not be considered as nuisance (negative externalities) by neighbors who share similar cultural preferences, but they may create an unpleasant sight even for a building sparingly spotted with cloth drip drying in the outside. Cloth drip drying by hanging can cause negative values to the building and buildings close by, and can discourage potential buyers with strong aesthetic preferences. Condominium by-laws concerning the type of things that can be put in the balcony of a building are often found in western cities; but for communities that have large number of people in a building wanting to drip dry their clothes, by-laws prohibiting cloth hanging outside the building may not be easy to enforce. This paper argues that innovative architectural design can help improve aesthetic concerns without rejecting a "national flags" habit. In other words, externalities problems can be resolved by innovative design by "having the cake and eat it too". Designing institutions that rewards architects who produce design solutions that help to solve externality issues a major step forward towards creating sustainable cities.