Why participation? Institutions and inequality in urban politics

In land use policymaking, institutions for resident participation are common but often associated with stark inequalities. We argue that the observed connection between participatory institutions and political inequality arises due to the circumstances in which participatory institutions are established – not due to participation itself. In a formal model, residents of two districts compete to oppose a locally costly (but socially beneficial) proposal. Participatory institutions allow residents to send a costly signal of their preferences to a politician. The politician only establishes participatory institutions when they are moderately biased toward one district. When extremely biased, the politician unilaterally benefits one district at the other’s expense; when sufficiently egalitarian, the politician allows each district to approve or veto projects themselves. We relate these results to the changing structure of urban politics in the wake of the Great Society. Despite justified concerns about inequalities in participation, eliminating participatory institutions may actually increase unequal policy outcomes.